Stocks and Precious Metals Charts - Justice, For Some - Non-Farm Payrolls Tomorrow

"Free Markets"

"The IRS audits the working poor at about the same rate as the wealthiest 1%.  Now, in response to questions from a U.S. senator, the IRS has acknowledged that’s true but professes it can’t change anything unless it is given more money.

ProPublica reported the disproportionate audit focus on lower-income families in April. Lawmakers confronted IRS Commissioner Charles Rettig about the emphasis, citing our stories, and Sen. Ron Wyden, D-Ore., asked Rettig for a plan to fix the imbalance.  Rettig readily agreed.

Last month, Rettig replied with a report, but it said the IRS has no plan and won’t have one until Congress agrees to restore the funding it slashed from the agency over the past nine years — something lawmakers have shown little inclination to do."

ProPublica, IRS: It’s Just Easier and Cheaper to Audit the Poor


"Since the first Fed rate cut, these are what the stock market benchmarks have done: Dow -2.9%; S&P 500 -3.1%; Nasdaq -4.8%; Russell 2000 -6.0%.   Even before today’s slide, the small-caps were down 14% from their peaks and are flashing warning signs for the broader market.  As an aside, when the ISM has hit 47.8 in the past, it rarely bottomed there and indicates 60%+ chance that the recession is about to start."

David Rosenberg

The ISM Services number came in very weakly this morning, missing all estimates.

And so stocks and the dollar took a dive, and gold and silver rallied.

But the wiseguys were not to be denied, and used the quiet afternoon to walk stocks back up to a gain.

The Non-Farm Payrolls number tomorrow could be a market mover, one way or the other. I did not take positions on the bearish side overnight because the NFP is far too easy for the executive branch to manipulate in the short term.

And the brazen obviousness of the lies coming out of Washington are just stunning.

We  are in the land of oligarchs, and their demagogues and stooges.

Have a pleasant evening.

Stocks and Precious Metals Charts - The Savour of Death

Load up on guns, bring your friends
It's fun to lose and to pretend
With the lights out, it's less dangerous
Here we are now, entertain us.

Nirvana, Smells Like Teen Spirit


"For the hearts of these people are hardened,
and their ears cannot hear,
and they have closed their eyes,
so their eyes cannot see,
and their ears cannot hear,
and their hearts cannot understand,
and they cannot turn to me
and let me heal them."

Matthew 13:15


"They do not see the image of Almighty God before them, and ask themselves what He wishes: if once they did this they would begin to see how much He requires, and they would earnestly come to Him, both to be pardoned for what they do wrong, and for the power to do better.   And, for the same reason that they do not please Him, they succeed in pleasing themselves.

Surely, there is at this day a confederacy of evil, marshalling its hosts from all parts of the world, organizing itself, taking its measures, enclosing the Church of Christ as in a net, and preparing the way for a general Apostasy from it. Whether this very Apostasy is to give birth to Antichrist, or whether he is still to be delayed, as he has already been delayed so long, we cannot know; but at any rate this Apostasy, and all its tokens and instruments, are of the Evil One, and savour of death."

John Henry Newman

Another round of economic data intruded on the illusions of exceptionalism and prosperity this morning.   The pigmen and their servants are restless.

Well, tomorrow is another day, and a good ISM Services number, if such a thing is on deck, will provide a renewed enthusiasm for the games that we play.

The Dollar was lower and gold and silver rose sharply.  Funny, that the metals went down BEFORE Golden Week, a seven day national holiday in China.

The theory there is, of course, that during Golden Week with their markets closed, the Chinese will not be active in the physical markets, thereby cramping the style of the paper leverage games in New York and London.  But the stiff decline in the metals happened before Golden Week even began.

By the way, have you noticed that the Chinese have stopped the big offtakes in physical gold from the Hong Kong Comex warehouses some months ago?  Do you know why?

The big hit on the metals last month was driven largely, if not almost exclusively, by market antics on the Comex, and the four or five houses who were sucking on the wrong end of a big metals short, with an intense desire to drive the price down and cover.   And so they did.

Not one thing has changed.   The markets may rally madly on a different set of economic data into the weekend.  But this is not reform or recovery. 

Need little, want less, and love more.  For blessed are those who called to the supper of the Lamb.

Have a pleasant evening.

Stocks and Precious Metal Charts - Slowdown in US Manufacturing Stuns the Markets - A Nation of Servants

"The trust of the innocent is the liar's most useful tool."

Stephen King, Needful Things


"The bully type, the false 'tough,' has been the first to break down under the actual fire of battle.  The quiet, the calm, the determined have made the best soldiers.  Why? Obviously the bully is insecure in himself— he blusters to muster his own courage."

Pearl S. Buck, What America Means to Me


"Narcissists damage and hurt but they do so offhandedly and naturally, as an afterthough. They are aware of what they are doing to others - but they do not care.”

Sam Vaknin, Malignant Self-Love


"We have now sunk to a depth at which the restatement of the obvious is the first duty of intelligent men. It is not merely that at present the rule of naked force obtains almost everywhere. Probably that has always been the case. Where this age differs from those immediately preceding it is that a liberal intelligentsia is lacking. Bully-worship, under various disguises, has become a universal religion."

George Orwell


“Crowd-pleasers [demagogues] are generally brainless swine who can go out on a stage and whip their supporters into an orgiastic frenzy— then go back to the office and sell every one of the poor bastards down the tube for a nickel apiece.”

Hunter S. Thompson


The so-called paradox of freedom is the argument that freedom in the sense of absence of any constraining control must lead to very great restraint, since it makes the bully free to enslave the meek. The idea is, in a slightly different form, and with very different tendency, clearly expressed in Plato."

Karl Popper


"A confident, aggressive delivery style - often larded with jargon, clichés, and flowery phrases - makes up for the lack of substance and sincerity in their interactions with others ... they are masters of impression management; their insight into the psyche of others combined with a superficial - but convincing - verbal fluency allows them to change their personas skillfully as it suits the situation and their game plan.

The most debilitating characteristic of even the most well-behaved psychopath is the inability to form a workable team."

Paul Babiak and Robert Hare, Snakes in Suits

The end of quarter antics of Wall Street hit a brick wall this morning, when before the bell the ISM Manufacturing Index came in at 47.8%, which was quite a miss, and showed the early signs, not only of slowdown, but contraction. This also reinforced the Chicago PMI which came in with a shockingly low 47.1 on Monday.

And so stocks dumped and gold and silver rallied. The Dollar was marginally lower.

I would not count these jokers out just yet. We have some additional data coming out this week, especially the Non-Farm Payrolls and the ISM Services Index, which may serve to provide the wiseguys some additional courage in their market manipulation.

After all, 'manufacturing' is so much an old economy thing, and services are where we wish to be. A nation of servants ruled over by a few oligarchs and their enablers.

Have a pleasant evening.

Stocks and Precious Metals Charts - End of Quarter Boogie Woogie - Non-Farm Payrolls and Golden Week

"Price discovery is not a sexy function of markets, but it is critical to the efficient allocation of scarce capital and resources, and to the preservation of the long term wealth of investors and the economy as a whole.  If price discovery is compromised by manipulation, then we will all be gradually impoverished and the economy will be imbalanced and unstable.

Over the past 25 years the forces of regulatory liberalisation and demutualisation of markets have allowed the largest global banks to set the rules, processes and infrastructure of global markets to their own self-interested requirements."

London Banker, Lies, Damn Lies, and LIBOR


"Plus ça change, plus c'est la même chose."

Jean-Baptiste Alphonse Karr, Les Guêpes

Today was the end of the third quarter. As usual the paint was going on the tape again to make those end of quarter results look better, or at least less bad.

The big shorts in the gold and silver markets, primarily on the Comex, managed to continue the knockdown of the metals that began with the October option expiration last week. see the Dr Evil strategy for details about this.

'Golden Week', a seven day national holiday in China, begins on October 1. There markets are closed. This provides a good cover for the paper trading to be conducted without undue physical buying pressure. Although the rise and steady level of gold inventories in the Comex Hong Kong has been notable.

There was a huge amount of gold contracts changing hands on the Comex last Friday.   The big seller was customers at JPM and the house account at HSBC. I have included that clearing report below.

The big gold contract buyers were the house accounts at JPM, Goldman, Citi, and MacQuarie.  Presumably some of this was short covering.

I would imagine that the price smackdown today and the past few trading sessions will have knocked down the number of longs being held in both gold and silver.

The Dollar was up marginally, as were stocks, and the VIX drifted lower.

There will be a Non-Farm payrolls report on Friday.

I was closed out of the remaining trading position I had long gold in the opening minutes today, on a tight stop.  A good chunk of it went out on Friday.  I will be looking for a re-entry point.  Carefully.

My thoughts on the markets with regard to support and resistance levels are marked on the charts below.

Have a pleasant evening.