Stocks and Precious Metals Charts - Balancing Act

"It has been the longest bull market in modern history, enabled by massive Central Bank intervention. But with trade wars raging, Brexit, Presidential impeachment over something, etc., there remains a significant risk of a recession over the next 12 months.

If we look at the normalized change in the 10Y-3M curve minus normalized change in 10Y yields, we can see a heightened recession risk. Lower yields and steeper curves are not a good recipe. And then we have the decline in S&P 500 earnings estimates. Recession coming?"

Anthony Sanders, Confounded Interest


"Day by day the money-masters of America become more aware of their danger, they draw together, they grow more class-conscious, more aggressive. The [first world] war has taught them the possibilities of propaganda; it has accustomed them to the idea of enormous campaigns which sway the minds of millions and make them pliable to any purpose.

American political corruption was the buying up of legislatures and assemblies to keep them from doing the people's will and protecting the people's interests; it was the exploiter entrenching himself in power, it was financial autocracy undermining and destroying political democracy. By the blindness and greed of ruling classes the people have been plunged into infinite misery."

Upton Sinclair, The Brass Check

Stocks slumped again today on renewed concerns about global trade.

December 15^th may be a date of interest, tariff-wise.

As you can see from the charts, the major stock indices managed to crawl back up to a reasonable level of trend support.

The rest of the week into the Non-Farm Payrolls Report should tell us the story.

Gold and silver had a nice rally higher after a long coiling process.

But we are still well within the short term declining (coiling?) patterns on the chart. So no breakout yet.

The underpinnings of the market are vulnerable to exogenous shocks. So I would proceed with caution.

The equity and high yield bond markets are leaning heavily on the Fed's balance sheet. And that may not be a longer term sustainable arrangement, and certainly not any formula for sustainable economic recovery.

What would I do?  Reform.   It's obvious.  The system is bent, and consciously so, to sweep the wealth up to a few 'at the top.'  It's a racket.

But the credibility trap will not allow the powers that be and their enablers and politicians to consider it as an option, or even to cite systemic imbalance and corruption as a problem.   Those that do are ignored, smeared, and villified by those that thrive on the existing imbalance.

The banks must be restrained, and balance restored to the economy, and the dark money power limited from its manipulation of policy, politics, and public discourse, before there can be any sustainable recovery.

Have a pleasant evening.

Stocks and Precious Metals Charts - Corporate Buybacks Are the Stock Market

"There is no clean way to make a hundred million bucks.  Somewhere along the line guys got pushed to the wall, nice little businesses got the ground cut out from under them.  Decent people lost their jobs.  Big money is big power, and big power gets used wrong."

Raymond Chandler, The Long Goodbye


"The very banality and innocence of the first act only allowed the blow to fall afterwards with more awful effect.”

Robert W. Chambers, The King In Yellow


"There is no trap so deadly as the trap you set for yourself.”

Raymond Chandler, The Long Goodbye

No worries, as long as corporations can keep dodging taxes and borrowing on the cheap.

And the band played on.

Stocks were off quite a bit today on a worse than expected ISM Manufacturing number, and a fresh round of trade war headlines.

The underpinnings of the markets are a bit thin, and hardly resilient.

Gold and silver were flattish despite the weaker Dollar and the elevated VIX.

The action in the December gold contract is very strong as expected. I  have included the latest clearing report from the CME below.

People go mad in herds, it is said, but come back to their senses one at a time.

Have a pleasant evening.

Welcome to December

Not much snow so far, but everything outside is covered with sleet and ice.

Frosty.

The grocery stores saw a brisk trade yesterday afternoon and this morning, I'd say.

The real snow is supposed to start showing up tomorrow afternoon until Tuesday morning.

Stocks and Precious Metals Charts - Light Equity Trading, Brisk December Gold Contract Action Reported

“Whoever commits a fraud is guilty not only of the particular injury to him who he deceives, but of the diminution of that confidence which constitutes not only the ease but the existence of society."

Samuel Johnson


"The world of finance hails the invention of the wheel over and over again, often in a slightly more unstable version.”

John Kenneth Galbraith


"Make no mistake about it, just as Lehman Brothers was set up to take the fall for triggering the 2008 collapse, China is being groomed as the new scapegoat for the coming crisis. But China’s economic slump is only a symptom, not the disease.

The reality is that the repeal of Glass-Steagall ushered in the greatest wealth transfer scheme in the history of America, allowing six mega banks in America to control the vast majority of insured deposits, use those taxpayer-backed deposits to gamble for the house, loot the bank from the inside by paying billions of dollars to select employees and customers and then hand the gambling tab to the taxpayer when the casino burns down. This model is a staggering headwind on both U.S. and global growth because it has created the greatest wealth and income inequality since the Great Depression."

Pam and Russ Martens


“Each day we are becoming a creature of splendid glory, or one of unthinkable horror.”

C. S. Lewis

There was the expected brisk action in the December gold contract reported today. I have included the clearing report below. Because of the holiday there were no inventory reports at the market close.

Stocks drifted lower, in anticipation of a protracted lack of forward progress in the US-China trade talks.

Market risks remain elevated and under-anticipated.

There will be a Non-Farm Payrolls report next week.  I have included the economic calendar for next week below.

The banks must be restrained, and balance restored to the economy, and the dark money power limited from its manipulation of policy, politics, and public discourse, before there can be any sustainable recovery.

We had these things, put in place many years ago, and we allowed them to be slowly but surely eroded away.

Have a pleasant weekend.