Stocks and Precious Metals Charts - The Vulgar Exceptionalism of the Plutocracy

 

"The big reactionaries of the business world and their allies and instruments among politicians and newspaper editors took advantage of this division of opinion, and especially of the fact that most of their opponents were on the wrong path; and fought to keep matters absolutely unchanged. These men demanded for themselves an immunity from governmental control which, if granted, would have been as wicked and as foolish as immunity to the barons of the twelfth century. 

Many of them were evil men.  Many others were just as good men as were some of these same barons; but they were as utterly unable as any medieval castle-owner to understand what the public interest really was.  There have been aristocracies which have played a great and beneficent part at stages in the growth of mankind; but we had come to the stage where for our people what was needed was a real democracy; and of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of a plutocracy."

Theodore Roosevelt, Autobiography, 1913

“Though you be proud and wise and beautiful, yet will death wipe you from the face of the earth like the mice underground; and your posterity, your history, and the immortality of your men of genius will be as frozen slag, burnt down together with the terrestrial globe.  

You have lost your reason and taken the wrong path.  You have taken lies for truth, and hideousness for beauty.  So I marvel at you who exchange heaven for earth.  I don’t want to understand you."

 Anton Chekhov, The Bet, January 14, 1889

"What is truth?  You submit to tyranny when you renounce the difference between what you want to hear and what is actually the case.  To abandon facts is to abandon freedom.  If nothing is true, then no one can criticize power, because there is no basis upon which to do so.  If nothing is true, then all is spectacle.  The biggest wallet pays for the most blinding lights.   Authoritarianism begins when we can no longer tell the difference between the true and the appealing.   At the same time, the cynic who decides that there is no truth at all is the citizen who welcomes the tyrant.

Sometimes people ask this question because they wish to do nothing.  Generic cynicism makes us feel hip and alternative even as we slip along with our fellow citizens into a morass of indifference.  It is your ability to discern facts that makes you an individual, and our collective trust in common knowledge that makes us a society.

Do not obey in advance.  Most of the power of authoritarianism is freely given.  In times like these, individuals think ahead about what a more repressive government will want, and then offer themselves without being asked.  A citizen who adapts in this way is teaching power what it can do.

When political leaders set a negative example, professional commitments to just practice become more important.  It is hard to subvert a rule-of-law state without lawyers, or to hold show trials without judges.  Authoritarians need obedient civil servants, and concentration camp directors seek businessmen interested in cheap labor.

Be calm when the unthinkable arrives.  Modern tyranny is terror management.  When the terrorist attack comes, remember that authoritarians exploit such events in order to consolidate power.  The sudden disaster that requires the end of checks and balances, the dissolution of opposition parties, the suspension of freedom of expression, the right to a fair trial, and so on, is the oldest trick in the Hitlerian book.  Do not fall for it.

No major war or act of mass killing in the twentieth century began without the aggressors or perpetrators first claiming innocence and victimhood.”

Timothy Snyder, On Tyranny: Twenty Lessons from the Twentieth Century, February 2017

Gold and silver rallied sharply, but the prices were steadily pushed lower into the close.

Stocks struggled with a large decline, but gained back some ground in the afternoon.

See a trend here?   

VIX wallows.

The Dollar gave up on chopping and declined steadily.

The inventory of physical gold bullion in Hong Kong has fallen to a low that I cannot remember seeing in all the years I have been following this.

It is running a fine line on a failure to deliver.   It appears that the customers are willing to work with them on their limitations to supply demand at these prices, for now.

Stock option expiration on Friday.

Comex expiration next week.

Will Wall Street be hoisted on its own pétard?

Have a pleasant evening.

Stocks and Precious Metals Charts - The Anguish of the Fallen

 

"The goal has been the 'Third Worldization' of the United States:

• an increasingly underemployed, lower-wage work-force;
• a small but growing moneyed class that pays almost no taxes;
• the privatization or elimination of human services;
• the elimination of public education for low-income people;
• the easing of restrictions against child labor;
• the exporting of industries and jobs to low-wage, free-trade countries;
• the breaking of labor unions;
• and the elimination of occupational safety and environmental controls and regulations."

Michael Parenti, Land of Idols, 1994

“Son of man, they have set up idols in their hearts. They cling to the errors that will make them fall into sin. Why should I allow myself to hear them?"

Ezekiel 14:3

"Surface idols are things like money, spouse, children, through which our deep idols seek fulfillment.  For example, money can be a surface idol that serves to satisfy more foundational influences.  Surface idols are things through which our deep idols seek fulfillment.  Some people want lots of money as a way to control their world and life, and such people usually don’t spend much money and they live very modestly. They keep it all safely saved and invested so that they can feel completely save in the world. Others want money for access to social circles and to make themselves beautiful and attractive. These people do spend their money on themselves in lavish ways.

Other people want money because it gives them so much power over others.  In every case, money functions as an idol, and yet because of various deep idols it results in very different patterns of behavior. The person using money to serve a deep idol of control will often feel superior to others and use money to obtain power or social approval. In every case however, money idolatry slaves and distorts lives.

An idol is something we cannot live without.  We must have it.  Therefore it drives us to break rules we once honored, to harm others, even ourselves, in order to get it.  Idols give us a sense of being in control.   Idols control us since we feel like we must have them or life is meaningless.”

Timothy Keller, Counterfeit Gods, 2009

“Every idol, however exalted, turns out, in the long run, to be a Moloch, hungry for human sacrifice.”

Aldous Huxley, The Devils of Loudon, 1952

"Then the kings of the earth, the rulers, the generals, the wealthy, the powerful, and every slave and freedman hid themselves in the caves and among the rocks of the mountains. And they cried to the mountains and the rocks, 'Fall on us, and hide us from the face of the one who sits on the throne and from the wrath of the Lamb. For the great day of their judgement has come, and who is able to survive?'”

Revelation 6:15-17

As a reminder, there will be a stock option expiration this Friday.

 

Stocks did their usual boogie woogie, with unsurprising mixed results.

 

The rally is narrowing again.   The SP 500 is working on what could be a triple top.

 

VIX was lower, and is starting to sound a bit of a complacency alarm.

 

The Dollar chopped sideways.

 

The battle over the physical supply of precious metals continues, pitting the banking dreadnoughts of the American financial system against most of the rest of the world.

 

Things are likely to get more and more interesting, and enlightening.

 

Have a pleasant evening.

Stocks and Precious Metals Charts - Creatures of the Kleptocracy

 

"The London Gold Pool was the pooling of gold reserves by a group of eight central banks in the United States and seven European countries that agreed on 1 November 1961 to cooperate in maintaining the Bretton Woods System of fixed-rate convertible currencies and defending a gold price of US$35 per troy ounce by interventions in the London gold market.

The central banks coordinated concerted methods of gold sales to balance spikes in the market price of gold as determined by the London morning gold fixing while buying gold on price weaknesses. The United States provided 50% of the required gold supply for sale. The price controls were successful for six years until the system became no longer workable. The pegged price of gold was too low and runs on gold, the British pound, and the US dollar occurred and France decided to withdraw from the pool. The London Gold Pool collapsed in March 1968.

The London Gold Pool controls were followed with an effort to suppress the gold price with a two-tier system of official exchange and open market transactions, but this gold window collapsed in 1971 with the Nixon Shock, and resulted in the onset of the gold bull market which saw the price of gold appreciate rapidly to US$850 in 1980."

Wikipedia, The London Gold Pool

"Let us create a society in which it is easier for people to be good."

Peter Maurin

"We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K."

Edward 'Steady Eddie' George, Governor Bank of England 1993-2003, from Reg Howe v. BIS, JPM et al.

"God intended things to be much easier than we have made them."

Dorothy Day

"You might think that parking your money in a big bank like JP Morgan Chase would insulate you from fraud. It’s just the opposite.   The big banks are the biggest perpetrators of financial fraud – fraud that affects millions of us, either directly or indirectly, on an ongoing basis.  While they are wrist slaps when properly scaled, you can see the list of 'settlements' made between the government and the big banks here.   These 'settlements,' the aftermath of Wall Street's near production of a second Great Depression, entailed not a single criminal indictment.   The top two repositories of banksters, based on the number of settlements, are Bank of America and JP Morgan Chase.

The banks engage in fraud for two reasons.   First, they profit from swindling the public.  Second, they can get away with it via a simple technique.   They buy off the regulators with promises of enormously lucrative jobs when they leave government service, and they buy off the politicians with huge direct and indirect campaign contributions."

Laurence Kotlikoff, When Banksters Buy Regulators and Prosecutors, Forbes, October 21, 2014


Gold and silver rebounded sharply from the calculated slamdown of last Friday. So why did they bother? 

What they accomplished was to break the upward momentum of the precious metals, in order to keep their price 'under control' in heavy demand.  And more importantly it loosened up some of the physical bullion that was being borrowed from certain funds at increasingly higher rates.  

The precious metal complex in New York and London is highly leveraged, and gold is often leased and rehypothecated multiple times.

The collapse of a leveraged scheme like this can result is some serious fireworks in the financial markets.  

Stocks managed to hold on and eke out some gains.

VIX wallowed.

The Dollar ticked up a bit.

 There will be a stock market option expiration this Friday.

Precious metals futures contracts options expiration next week.

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

Often without really making up our minds to be either good or evil.

Have a pleasant evening.

 

Blessings and Woes - The Sermon on the Plain

 

"Why do you call out to me, ‘Lord, Lord,’ but not do as I ask?  I will tell you what someone is like who comes to me, listens to my words, and acts on them.  That one is like a person building a house, who dug deeply and laid the foundation on rock; when the flood came, the river burst against that house but could not shake it because it had been well built.  But the one who listens and does not act is like a person who built a house on the ground without a foundation.  When the river burst against it, it collapsed at once and was completely destroyed.”

Luke 46-49

As long as we live within the world's delusions, our addictions condemn us to futile quests leaving us to face an endless series of disillusionments while our sense of self remains unfulfilled.  In these days of increasing addictions, we have wandered far away from our Father's home.   The addicted life can aptly be designated a life lived in 'a distant country.'  It is from there that our cry for deliverance rises up.”

Henri J.M. Nouwen, The Return of the Prodigal Son

“Cursed is the man who trusts in men, who trusts in the flesh for their strength, and whose heart turns away from the Lord. For they will be like a bush in the desert and will not see when good comes. They will live in dry wastes in the desert, in a land of salt where no other people live.

Good will come to the one who trusts in the Lord, and whose hope is in the Lord. They will be like a tree planted by the water, that sends out its roots by the river. It will not be afraid when the heat comes but its leaves will be green. It will not be troubled in a dry year, or stop giving fruit."

Jeremiah 17:5-8

"The Pharisee stood by himself and prayed: ‘I thank you, God, that I am not like other people—cheaters, sinners, adulterers. I’m certainly not like that tax collector! I fast twice a week, and I give you a tenth of my income.’  But the tax collector stood at a distance and dared not even lift his eyes to heaven as he prayed.  Instead, he beat his chest in sorrow, saying, ‘O God, be merciful to me, for I am a sinner.’  I tell you, this sinner, not the Pharisee, returned home justified before God. For those who exalt themselves will be humbled, and those who humble themselves will be exalted.”

Luke 18:11

"The root of all sin is pride, superbia.  I want to be my own law, I have a right to my self, my hatred and my desires, my life and my death.  The mind and flesh of man are set on fire by pride; for it is precisely in his wickedness that man wants to be as God."

Dietrich Bonhoeffer, Life Together, 1939

"You felt secure in your wickedness.  You think, ‘No one sees what I do.'  But your so-called wisdom and knowledge have led you astray.  And you believe that, ‘I am the one, no one else matters.’   Disaster will overwhelm you, and you won’t be able to talk it away.  Misfortune will descend upon you, and you won’t be able to buy your way out.   A catastrophe will strike you suddenly, one which you cannot avoid."

Isaiah 47:10-11

‘Blessed are you who are poor,
      for yours is the kingdom of God.
‘Blessed are you who are hungry now,
      for you will be filled.
‘Blessed are you who weep now,
      for you will laugh.
‘Blessed are you when people hate you, and when they exclude you,
      revile you, and defame you on account of the Son of Man.
Rejoice on that day and leap for joy, for surely your reward is great in heaven;
      for that is what their ancestors did to the prophets.

‘But woe to you who are wealthy,
      for you have received your consolation.
‘Woe to you who are full now,
      for you will be hungry.
‘Woe to you who are laughing now,
      for you will mourn and weep.
‘Woe to you when all speak well of you,
      for that is what their ancestors did to the false prophets.'"

Luke 6:20-26