Stocks and Precious Metals Charts - Shameless - And the Band Played On

 

"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.  Our first duty is to clear away illusions and recover a sense of reality.  To recover a sense of reality is to recover the truth about ourselves and the world in which we live, and thereby to gain the power of keeping this world from falling apart."

Nikolai Alexandrovich Berdyaev

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

Tacitus

“These days, banks have become so big that much of what they do is merely shuffle wealth around, or even destroy it.   Instead of growing the pie, the explosive expansion of the banking sector has increased the share it serves itself.   Bizarrely, it’s precisely the jobs that shift money around – creating next to nothing of tangible value – that net the best salaries.   How is it possible that all those agents of prosperity – the teachers, the police officers, the nurses – are paid so poorly, while the unimportant, superfluous, and even destructive shifters do so well?

The Machiavellis are one step ahead.   They have the ultimate secret weapon to defeat their competition. They’re shameless.”

Rutger Bregman

"Financial predators are usually narcissistic and audacious.  They regularly have an extreme sense of entitlement coupled with high self-efficacy.  Many of them have a charismatic quality and are preternaturally persuasive.  Financial predators are commonly shameless and quite adept serial liars. They perceive themselves having near unlimited guile and resourcefulness to extricate themselves out of any compromising situations."

Russ Alan Prince, Forbes

The economic news provided a two stage boost to the risk trade this morning. 

The first was the Jobs Report, which came out remarkably strong and bearish, but with a somewhat strained reading was viewed as bullish for risk assets, because of a less robust gain in wages. 

Some styled it as indicative of an 'immaculate disinflation.'

That boost was quickly fading, as most refused to believe it.

But at 10 AM the next stage of data, the ISM Manufacturing, and to a lesser extent employment, came in a bit light, and then we were off to the races.

The usual melt up and short squeeze de luxe ensued.

My skeptical self tends to view this as the beginning of yet another wash and rinse cycle.  

Now all that is required, as it usually happens, is for some voice from the Fed, or additional data, to throw shade on the story that the Fed will begin to moderate its interest rate tightening.  It seems to be the way things are done these days.

But on a happy note gold and silver caught a rally bid as well, with the Dollar falling fairly hard.  

Gold has not yet broken out.

Let's see how long this lasts.

The circus in the House of Representative continues, the Velvet Insurrection Part Deux.

And the band played on.

Have a pleasant weekend.

 

Stocks and Precious Metals Charts - Minsky Moment - Our Year of Living Dangerously

 

"In particular, over a protracted period of good times, capitalist economies tend to move from a financial structure dominated by hedge finance units to a structure in which there is large weight to units engaged in speculative and Ponzi finance."

Hyman Minsky, The Financial Instability Hypothesis

"The period of financial distress is a gradual decline after the peak of a speculative bubble that precedes the final and massive panic and crash, driven by the insiders having exited but the sucker outsiders hanging on hoping for a revival, but finally giving up in the final collapse."

Charles Kindelberger, Manias, Panics, and Crashes: A History of Financial Crises

"Twenty-five years ago, when most economists were extolling the virtues of financial deregulation and innovation, a maverick named Hyman P. Minsky maintained a more negative view of Wall Street; in fact, he noted that bankers, traders, and other financiers periodically played the role of arsonists, setting the entire economy ablaze. Wall Street encouraged businesses and individuals to take on too much risk, he believed, generating ruinous boom-and-bust cycles. The only way to break this pattern was for the government to step in and regulate the moneymen.

Today, with the subprime crisis seemingly on the verge of metamorphosing into a recession, references to it have become commonplace on financial web sites and in the reports of Wall Street analysts. Minsky’s hypothesis is well worth revisiting."

John Cassidy, The Minsky Moment, The New Yorker, 4 February 2008

"FDR came right at Wall Street and the Banks with serious reform that saved capitalism from itself, and worked for a generation to hold back its darker impulses.  This is a lesson that we have apparently forgotten.

If the Fed attempts their old fix [cheap money, financial asset inflation] once again, they may do what I thought was almost inconceivable, and go a step beyond mere stagflation which is bad enough, and cause an actual break in confidence, and the bond of their word, the currency. The people of the world will not be fooled forever.

As Hyman Minsky once said, and the moderns seem to have forgotten, 'Anyone can create money; the problem is in getting it accepted.'   He should have added, except by force [force is bad monetary policy by other means].  Reform goes hand in hand with recovery."

Jesse, Moral Hazard of the Fed's Current Policy: Fraudulent Paper, 24 January 2013


When a similar boom and bust, fomented in each case by Fed monetary policy, happens three times in 21 years, you may wish to consider that it is not an accident, or a coincidence, or addle-brained fat finger error, but something a little more purposeful, and at its heart more than mere careless incompetency.

The recent insider trading scandals in the Fed's highest ranks, and the ensuing cover-up and deflection, make our confidence a bit more strained.

Non-Farm Payrolls tomorrow.

Have a pleasant evening.

Stocks and Precious Metals Charts - Damned for the World

 

"Inequality is a euphemism, a kind of shorthand, for all of the things that have gone to make the lives of the rich so much more delicious, year on year, for the last three decades.   And also for the things that have made the lives of working people so wretched and so precarious in that same time.

It's visible in the ever rising costs of healthcare and college, in the coronation of Wall Street, and the slow blighting of wherever it is that you happen to live.  And you catch a glimpse of inequality every time you hear about someone that had to declare bankruptcy because a child got sick.  Inequality is about the way in which speculators, and even criminals, get a helping hand from Uncle Sam, while the Vietnam Vet down the street from you loses his house."

Thomas Frank, Listen Liberal

"The lofty mind of man can be imprisoned by the artifices of its own making.   If there are damned souls in Hell, it is because men blind themselves.”

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

"They [industrialists] were ruined, when they were required to send labouring children to school; they were ruined, when inspectors were appointed to look into their works; they were ruined, when such inspectors considered it doubtful whether they were quite justified in chopping people up with their machinery; they were utterly undone, when it was hinted that perhaps they need not always make quite so much smoke."

Charles Dickens, Hard Times

"You should thank God for bank bailouts. Now, if you talk about bailouts for everybody else, if you just start bailing out all the individuals instead of telling them to adapt, the culture dies.  There's danger in just shoveling out money to people who say, 'My life is a little harder than it used to be.'  At a certain place you've got to say to the people, 'Suck it in and cope, buddy.'"

Charlie Munger, September 2010


Non-Farm Payrolls report on Friday.

Let's see if there is another 'leak' of the data, and a violent burst of likely insider or collusive trading, as we saw with the CPI report on December 13.

Stocks had another volatile day, finishing up a little to the green.

Gold rallied again, and is pushing up against resistance for a breakout attempt.

Silver got nailed with the weakness in stocks.

VIX declined because.

The Dollar slipped a bit.

Have a pleasant evening.

Stocks and Precious Metals Charts - Les Enfants Terribles - Non-Farm Payrolls on Friday

 

"This is how the people of God may guide themselves and their own actions along the way.  If there is no love evident in the words and the heart, then the words and the actions are not of God, but of something else.

Love is not what we do, but how we do what we do.  Love is found in the most ordinary things, not in grand gestures and elaborate mannerisms, but in the small daily acts of kindness and fellowship, done lovingly and with care, for His sake.   It is how we carry our cross, not in front of a cheering crowd, but in the quiet moments, and the little things, while walking with Him.

We do not need to hate and reject the world, and despise and subdue His creation.  They are a gift from God, to which we bring our own good use and order in His name.   And if we are wise, with our reverent wonder.  We can work with His gifts lovingly, and not abuse them from excess and greed.

It is not the world that is a source of evil, but the willfulness of our hearts, made hard with pride.  Only love is creative and productive.   Only love is accepting and uplifting, able to bring all things forward to His plan and make them new.   Love consecrates, while sin desecrates and destroys in its lust for possession and the will to power."

Jesse, 24 June 2015

"Then I saw a new heaven and a new earth.  The old heaven and the former earth had passed away, and the sea was no more.  I also saw a holy city, a new Jerusalem, coming down out of heaven from God, prepared as a bride adorned for her husband.

I heard a loud voice from the throne saying, 'Behold, God’s dwelling is with the human race.  He will dwell with them, and they will be his people, and God will always be with them as their God.  He will wipe away every tear from their eyes, and there shall be no more death or mourning, wailing or pain, for the old order has passed away.'

The one who sat on the throne said, 'Behold, I make all things new.'"

Revelation 21:1-5

"When experience is not retained, as among savages, infancy is perpetual. Those who cannot remember the past are condemned to repeat it."

George Santayana

Gold and silver came in ripping higher after the holiday break.

But alas, the gods of the market and masters of the universe did not find it in their will to allow such an unseemly breakout.

Stocks slumped hard again, although they did bounce back a little in the late trade.

The VIX reading is odd.  It opened at 22.90 and apparently just camped out there all day.  Let's see if that was an error that gets corrected.  Hard to believe in such a lively market.

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

The days may change, but the song remains the same.

Have a pleasant evening.