Stocks and Precious Metals Charts - How I Learned to Stop Worrying and Love the Bubble

 

"We didn't truly know the dangers of the market, because it was a dark market," says Brooksley Born, the head of an obscure federal regulatory agency -- the Commodity Futures Trading Commission [CFTC] -- who not only warned of the potential for economic meltdown in the late 1990s, but also tried to convince the country's key economic powerbrokers to take actions that could have helped avert the crisis.  "They were totally opposed to it," Born says.  "That puzzled me.  What was it that was in this market that had to be hidden?"

"I walk into Brooksley's office one day; the blood has drained from her face," says Michael Greenberger, a former top official at the CFTC who worked closely with Born. "She's hanging up the telephone; she says to me: 'That was [former Assistant Treasury Secretary] Larry Summers. He says, "You're going to cause the worst financial crisis since the end of World War II."... [He says he has] 13 bankers in his office who informed him of this. Stop, right away. No more.'" 

Greenspan, Rubin and Summers ultimately prevailed on Congress to stop Born and limit future regulation of derivatives. "Born faced a formidable struggle pushing for regulation at a time when the stock market was booming," Kirk says. "Alan Greenspan was the maestro, and both parties in Washington were united in a belief that the markets would take care of themselves." 

PBS Frontline, The Warning, 20 October 2009
 

"The banks were central to the scheme from the inception as they spent years and many hundreds of millions of dollars to overturn Glass-Steagall to allow this coup de grâce to be delivered to all holders of US dollars."

PBS Frontline: The Long Demise of Glass-Steagall, 8 May 2003


"The crash has laid bare many unpleasant truths about the United States.  One of the most alarming, says a chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government - a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises.  If the IMF's staff could speak freely about the U.S., it would tell us what it tells all countries in this situation; recovery will fail unless we break the financial oligarchy that is blocking essential reform." 

Simon Johnson, The Quiet Coup, The Atlantic Monthly, May 2009 

 

“Crime, once exposed, has no refuge but audacity.” 

Tacitus

 

Stocks cast aside all concerns about war, pandemics, and debt, and rallied higher, going out on the highs.

Gold and silver were sold, as is traditional for a quad witching stock index expiration.

The Dollar moved a bit higher, gaining a firmer grip on the 98 handle.

It is not so much what the elites and their unspeakable enablers would do to maintain control of the financial system and the economy. 

The real question is, what wouldn't they do? 

Have a pleasant weekend.

 

Stocks and Precious Metals Charts - What Time's the Next Bailout

 

"Financial institutions such as JP Morgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses, and when, not if, they suffer losses so large that they would cause the bank to fail, they will be bailed out." 

William K Black 

 

"A synthetic instrument has no real assets.  It is simply a bet on the performance of the assets it references.  That means the number of synthetic instruments is limitless, and so is the risk they present to the economy. Synthetic structures referencing high-risk mortgages garnered hefty fees for Goldman Sachs and other investment banks. They assumed an ever-larger share of the financial markets, and contributed greatly to the severity of the crisis by magnifying the amount of risk in the system. 

Increasingly, synthetics became bets made by people who had no interest in the referenced assets. Synthetics became the chips in a giant casino, one that created no economic growth even when it thrived, and then helped throttle the economy when the casino collapsed." 

Carl Levin, US Senator 

 

“Most people are good and occasionally do something they know is bad.  Some people are bad and struggle every day to keep it under control.  Others are corrupt to the core and don’t give a damn, as long as they don’t get caught.  But evil is a completely different creature.  Evil is bad that believes it’s good.”

Karen Marie Moning

 

“Propaganda serves more to justify ourselves than to convince others; and the more reason we have to feel guilty, the more fervent our propaganda.”

Eric Hoffer

 

It was risk on again today, as stocks shook off their early losses and managed to rally back into the green, and finally went out near the highs.

The SP and NDX are approaching the level of their latest failed rallies.  

This could provide a good test of bully's new resolve to buy.

Gold and silver were higher.

The Dollar and the VIX both fell on the risk appetite for equities.

Quad witching option expiration tomorrow.

Every day we read and hear fresh stories of how the Russian military is experiencing disaster after disaster in the Ukraine.  

Their generals are dropping like flies, soldiers are abandoning their equipment and surrendering in tears, 

Every day it seems as though Russia is on the verge of admitting defeat and surrendering. 

And the Ukraine goes from victory to victory, triumph to triumph.

Just like the economy.

One can only wonder.

Have a pleasant evening.

 

Stocks and Precious Metals Charts - The Darkness of This World - Quad Witching Expiration Friday

 

"We cannot speak to the conscience of the world when our own conscience is asleep." 

Carl von Ossietzky

 

"In the [60 Minutes] interview, Kroft asks [Michael] Lewis: 'What’s the headline here?'  Lewis responds: 'Stock market’s rigged.  The United States stock market, the most iconic market in global capitalism is rigged.'

Kroft then asks Lewis to state just who it is that’s rigging the market.  Lewis responds that it’s a 'combination of these stock exchanges, the big Wall Street banks and high-frequency traders.'

It’s just shy of eight years since Lewis wrote the definitive book on the corrupted structure of Wall Street, and yet, Congress has taken no meaningful action to reform it.

Congress has taken zero meaningful actions to reform Wall Street since it brought the U.S. to its economic knees in 2008 because much of Congress is receiving large chunks of campaign dough from Wall Street and its outside lawyers, as well as from hedge funds that drop $10 million to a Super Pac as casually as paying for lunch at Milos.

The failure of America to reform its campaign financing structure has corrupted Congress in its ability to reform Wall Street. In turn, the lack of reform of Wall Street has left the U.S. with a dangerous financial system...”

Wall Street On Parade, Fog of War Providing Smoke Screen for Dangerously Unreformed Wall Street
 

"Beware of false prophets, who come to you in sheep's clothing but inwardly are ravenous wolves." 

Matthew 7:15 

 

The Fed did as it was expected today and raised its benchmark interest rate by 25 bp.

After some initial fakeout moves, stocks went into full risk on rally mode, going out near the highs.

The Dollar fell about 75 cents, and the VIX dropped back to its 50 day moving average.

Surprisingly enough both gold and silver came well off their lows, and finished in the green.

Let's see how bully goes into the weekend tomorrow.

As a reminder, this Friday is a quad witching index option expiration. 

What a surprise.

Have a pleasant evening.

 

Stocks and Precious Metals Charts - Risk On - FOMC Tomorrow

 

"No one today likes truth: utility and self interest have long ago been substituted for truth.  We live in a nightmare of falsehoods, and there are few who are sufficiently awake and aware to see things as they are."

Nikolai Berdyaev 

 

"If there are damned souls in Hell, it is because men blind themselves.” 

E.A. Bucchianeri, Faust: My Soul Be Damned for the World 

 

"The wealthy, not only by private fraud but also by common laws, do every day pluck and snatch away from the people some part of their daily living.  They invent and devise all means and crafts, first how to keep safely without fear of losing that which they have unjustly gathered together, and next how to hire and abuse the work and labor of the people for as little money and effort as possible." 

Thomas More, Utopia 

 

"War against a foreign country only happens when the moneyed classes think they are going to profit from it."

George Orwell

 

"Hubris calls for nemesis, and in one form or another it's going to get it, not as a punishment from outside but as the completion of a pattern already started." 

Mary Midgley, The Myths We Live By

The markets were clearly in a risk on mood today.

Perhaps it is due to some insights about what the illustrious Fed will be announcing tomorrow.

Or on the other hand, just a setup for an options week wash and rinse.

Be that as it may, gold and silver were pushed lower, but managed to hold up a little against the selling.

The Dollar chopped sideways.

Perhaps as a side effect of stocks, the miners I watch were in the green today.

FOMC tomorrow.   Stock index option expiration on Friday.

Here is a sample of what happens when a short metals trade implodes: JPM At the Center of Another Multi-Billion Trading Scandal.

The lies will continue, until confidence is restored.

Have a pleasant evening.