New Silk Road Physical Gold Demand Since 2005

Gold is flowing from West to East.

Stocks and Precious Metals Charts - Building Pressures, Gathering Storms - Chips Falling

"The human mind, except when guided by extraordinary genius, cannot surmount the established conclusions amid which it has been reared.”

Winston S. Churchill, The Gathering Storm


“Before mass leaders seize the power to fit reality to their lies, their propaganda is marked by its extreme contempt for facts as such, for in their opinion fact depends entirely on the power of man who can fabricate it.”

Hannah Arendt, The Origins of Totalitarianism


“Privilege is not knowing that you're hurting others and not listening when they tell you. Facts are threatening to those invested in fraud.”

DaShanne Stokes

Stocks were wobbling around again today. Since they have already retraced 50% of their big decline as shown on the futures charts below, a consolidation and decision point is natural.

There is no clear chart formation to reliably forecast the dirction of the next move. Several exogenous factors weigh on this.

The first is of course the simmering China-US trade war. A breakdown in talks would most likely cause equities to break to the downside, especially if it involves the activation of more tariffs.

The global economy is struggling, and this impacts and includes the US. Anything like a fresh trade war, or an unmanaged 'dirty' Brexit, might schock traders negatively.

Secondly, the Fed is still a major factor, although the likelihood of two more rate increases this year to 3.00$ has been greatly discounted in the futures markets.

There will be an FOMC meeting next week, and the markets will be watching what the Fed does, and especially what they say about their outlook for the rest of the year. I think there is a good possibility of a 25 bp increase, with hints of a more data-oritened, vigilant outook for a second. Unless something unexpected happens I suspect that a third rate increase this year looks unlikely.

It should be easily understood that macro events like China trae and Brexit may impact the Fed's future decisions. Their bias to raising further from the zero bound is there, but they need 'cover' from the economic data to continue to engage it.

Perhaps more imporantly, although less headline inspiring, will be the continuing unwinding of their balance sheet.

Gold continues to mark its place, tied up in the whole 'wating' mode in the markets. At this point silver is following, yet to be unleashed.

After the bell Intel beat earnings estimates but posted a clear miss on revenues. Since earnings are much easier to gimmick up in the short run vis accounting strategies, the big revenue miss had quite the negative impact on the stock which had been rallying into the close on expecations of a bigger beat.

Both the Democratic and Trumpolini proposals to end the government budgetary shutdown were defeated in the Senate. One has to wonder how ugly the next 'debt ceiling' discussions will be.

Need little, want less, love more. For those who abide in love abide in God, and God in them.

Have a pleasant evening.

Stocks and Precious Metals Charts - Wobbly

"Some wonder if it did fail, or did QE do exactly what its proponents wanted it to?  That is drive massive wealth to very small connected circle.  Some wonder if that wasn't the real goal all along and the crisis was a good excuse to implement their policies."

Harald Malmgren


"The public needs no further proof of the Fed’s inability to supervise the global banks than the fact that, at a time when it had dozens of its own inspectors sitting inside the banks, the banks were able to create toxic waste dumps of subprime debt and derivatives that blew up the U.S. financial system, the housing market, and the U.S. economy in 2008 while also taking down 100-year old Wall Street institutions.  If that’s not incompetence, we don’t know what is."

Pam Martens, Wall Street On Parade


"The Lord is my shepherd; I shall not want."

Psalm 23:1

Stocks wanted to go down today, and sank quite a bit after the initial open.

However, once again stocks were able to shake off their lows into the afternoon trade and finish with modest gains into the close.

Gold finiashed off a bit even as the dollar drifted slightly lower.

The fear and hate mongering business seems to be on the increase.

Lord, make me an instrument of your peace.

Have a pleasant evening.

Stocks and Precious Metals Charts - Théâtre de l'Absurde - Tales from Two Dimensional Davos Men

Estragon:  We always find something, eh Didi, to give us the impression we exist?

Vladimir:  Yes, yes, we're magicians...

Estragon: Who believes him?

Vladimir: Everybody. It's the only version they know."

Samuel Beckett, Waiting for Godot


The world needs a new generation of policymakers who don’t hobnob with billionaire speculators and who understand workers’ concerns. Unfortunately, the change will not come smoothly."

Andy Xie


"At the root of America's economic crisis lies a moral crisis: the decline of civic virtue among America's political and economic elite. A society of markets, laws, and elections is not enough if the rich and powerful fail to behave with respect, honesty, and compassion toward the rest of society and toward the world."

Jeffrey Sachs


"Wealth, in even the most improbable cases, manages to convey the aspect of intelligence. Wealth is the relentless enemy of understanding. In a community where the primary concern is making money, one of the necessary rules is to live and let live. To speak out against madness may be to ruin those who have succumbed to it. So the wise in Wall Street are nearly always silent. The foolish thus have the field to themselves. None rebukes them.

People of privilege will always risk their complete destruction rather than surrender any material part of their advantage. Intellectual myopia, often called stupidity, is no doubt a reason. But the privileged also feel that their privileges, however egregious they may seem to others, are a solemn, basic, God-given right."

John Kenneth Galbraith

Stocks were in selloff mode from the overnight, as the rumors about trade deals that lifted the markets late last week had grown stale.

The economic news was not helping, either domestically or from overseas.

Some late afternoon rumor calibration from Larry Kudlow had stocks coming off their lows of the day, but still closing with some less than inconsequentials losses.

Gold and silver finished higher as the Dollar managed to close nearly unchanged after a dipsy doodle day.

The news of the day from Davos was almost unbelievably scripted and vacuous behind the headlines, while at the same time mildly nauseating.   Much like so many modern reality TV shows.

Speaking of which, McConnell has agreed to bring some of the Democratic 'kick the can' proposals over opening the government for a few weeks to a floor vote in the Senate.  They will also vote on Trumpolini's compromise proposal.

Need little, want less, love more.  For those who abide in love abide in God, and God in them.

Have a pleasant evening.