C. S. Lewis BBC Broadcast 21 March 1944

"A man can no more diminish God's glory by refusing to worship Him than a lunatic can put out the sun by scribbling the word, 'darkness' on the walls of his cell. Aim at heaven and you will get earth thrown in. Aim at earth and you get neither...

C. S. Lewis, The Problem of Pain

We all want progress.  But progress means getting nearer to the place where you want to be. And if you have taken a wrong turning, then to go forward does not get you any nearer.  If you are on the wrong road, progress means doing an about-turn and walking back to the right road; and in that case the man who turns back soonest is the most progressive man.”

C.S. Lewis, Mere Christianity

During the height of World War II, the BBC carried a series of radio broadcasts by C. S. 'Jack' Lewis, the Oxford don and good friend of fellow author J. R. R. Tolkien.

The broadcasts, which were immensely popular, were later gathered into a book, titled Mere Christianity.

Mere Christianity is a book by C. S. Lewis, adapted from a series of BBC radio talks made between 1942 and 1944. The transcripts originally appeared as three separate pamphlets: The Case for Christianity (1942), Christian Behaviour (1943), and Beyond Personality (1944). 

Below is the broadcast titled Beyond Personality, and it is the only surviving recording which we have.  All the tapes of the other broadcasts were reused during the war effort.

Year To Date Performance of a Few US Asset Classes

“Propaganda is the executive arm of the invisible government.”

Edward Bernays
 

Gold Daily And Silver Weekly Charts - New All Time Highs - We're Flying!

 

Nothing else matters now, because We're flying!!

 

This is the combined precious metal and stock market commentary for Friday the 13th.

 

A fresh new bubble in stocks has achieved liftoff.  What could go wrong?

 

Shaking off the very weak economic news from the real economy in the latter part of this week, stocks took the opportunity to break out higher on relatively low volumes ahead of a three day weekend because of President's Day on the 16th.

What sparked this rally is the 'new ceasefire' between the Ukraine and Russia, and perhaps even more importantly, the continuation of talks between the troika and Greece with regard to the debt crisis there.

 

And mostly, because they could.  Motive and opportunity.

This is a hot money bubble. The Wall Street wiseguys had the opportunity for a new high and they have taken it, consequences be damned.  The political animals will look the other way, as long as the campaign handouts keep coming, and justice is especially blind given the right career incentives.

The strong dollar may be painful for the real economy, but the benefit is that it attracts foreign investment in paper, and gives the Banks and the hedge funds the ability to buy up assets on the cheap.  It increased the consolidation in commercial business, especially in the healthcare field which is ripe for the plucking. 

 

It helps to inflate dollar denominated financial assets.  It is a boon to Wall Street.

 

The Fed does not have to tighten interest rates to put some reins on this.  They have always had the discretion to raise margin requirements and a variety of other tools as the primary bank regulator for which they volunteered after the last crisis in which they were instrumental.

The Fed and the regulators and Wall Street are wholly responsible for this.   We are caught in a boom and bust cycle thanks to the distortions from an oversized financial sector and a corrupt political system and the acquiescence of the media and the professional classes.

It will end badly. Make no mistake.  When it does, everyone will be amazed because 'no one saw it coming.'

Serial policy errors. But it is swelling the net worth of the one percent, and so nothing will be said.

 

But in the meantime, we're flying!

 

Have a pleasant weekend. See you on Tuesday.

 

 

 

 

SP 500 and NDX Futures Daily Charts - All Time Highs - New Financial Bubble Lifts Off

The US markets were able to lift off ahead of a three day weekend to achieve new all time highs in equities, except for the Dow Industrials which was weighed down by American Express.

I was out almost all day, so the market commentaries will be combined under the Precious Metals entry above.

Have a pleasant weekend. See you on Tuesday.

Happy Valentine's Day!

Gold Daily and Silver Weekly Charts - Currency Wars

"As a delaying tactic, U.S. foreign exchange operations were often successful. They raised the potential costs of speculation and provided cover for unwanted, temporary, and ultimately reversible dollar flows. They delayed the drain of the U.S. gold stock. But to the extent that these devises substituted for more fundamental and necessary adjustments and postponed the inevitable collapse of Bretton Woods, they were a failure."

Robert Wenzel, Cleveland Fed Accidentally Links to Paper Highly Critical of US Currency Market Interventions to Support Bretton Woods

When I said, and it already seems so long ago, that we had broken out with a higher high a few weeks ago, I cautioned that the markets had not suddenly become honest and transparent. and so caution was still advised.

And indeed, the breakout was stuffed, by the usual routine of dumping large amount of futures contracts at the market in thin trading hours, often on the open of the NY trading.

This is the currency war. This is the struggle we are seeing for the nations of the world to find a new way of arranging their international trading relationships. This is the fruit of Triffin's Dilemma, which suggests that at some point if a single country manages the world's reserve currency, eventually they will come to an impasse between their domestic interests and the interests of the rest of the world.

And after the failure of Bretton Woods, and the slowly destabilization of Bretton Woods II, we are now at a time of reckoning.

 

Some mistakenly think the dollar is rising now because of Triffin's dilemma. This is really not the case, but rather a temporary policy choice by the US to allow the dollar to appreciate against the euro and the yen.  Remembering that the US Dollar DX index is weighted to a certain group of currencies that reflects how things were earlier in the last century.

The US is fostering the myth that it is already past the worst of the financial crisis.  A crisis, I might add, which its Banks largely promoted through their frauds, and the abuse of the dollar's reserve currency status with the cooperation of the Federal Reserve and acquiescence of the regulators.

This transition is not going to be short, nor easy.   And as for the precious metals, I have rarely seen so many who are so discouraged. They hear and see so many conflicting things that they do not know what to believe.

And losing money hurts, ESPECIALLY if you are using leverage and are overextended. Mining companies are levered plays on the precious metals, and the smaller the cap, the greater the leverage.

 

Timeframes also matter. I have been in this metals trade for a long time, but not because I like gold for itself.  When I was looking seriously into international money issues and global trade, which was related to the communications business I was in, I came to believe that we were approaching a currency wars scenario. 

 

It seemed pretty clear that the Dollar regime could not be sustained without the establishment of a very unipolar, de facto world governance, with perhaps two or three cooperating spheres of control.  I had written a paper about this in B-School in 1991 (ok I was a late bloomer but as an classically educated engineering type pure business management course were not my thing).  But my thinking really did not become firm enough to take action until around 2001.

 

And there is clearly a movement in the direction of a unipolar world, from the neo-cons and their associates.  Money is power, and power is the new god of the marketplace in the West, if not everywhere.

So try to keep this in perspective. These are very difficult times for those seeking safe havens.  A major supplier of retail precious metals is publicly referring to a large number of their customers as 'crazy' even while there is a sea-change with central banks increasing their gold reserves (although it is clear the WGC is a bit blinded to China).   Fed President Richard Fisher owns quite a bit of gold.  Maybe he is crazy too.

 

I remember, quite vividly, gold being at $280 and silver at $4.70 and the prevailing wisdom amongst almost all the traders I knew was that the precious metals were 'dead money.'  Seriously.  You could barely find a buyer less than 20 years ago. 

The truly big changes catch people flat-footed, because they run against the grain of what we knew yesterday. Most people are focused on the short term and the markets especially have come to take a very short term speculative bias.

I do not know what will happen in the future, and do not think for a minute that I do.  We are all in God's hands.  But I am looking for any signs, based on my understanding of how certain things work, and over a 20 year timeframe it is pretty much on track.

Don't be overly worried about these things that are beyond your control, or so fearful that you become preoccupied and distracted from your responsibilities and  a righteous path.  Rather, spend more of your time on things that you can control, and the things that will, in your waning days, loom most heavily on your conscience.  

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - The Pomp of Courts, the Pride of Kings...

 

One of my readers noted, more elegantly than I can remember, that le café has a remarkably eclectic menu, with wrestler Ric Flair and monetary discussion juxtaposed with John Henry Newman and Mad Magazine style satirical cartoons.

 

After thinking about it I said, I had not thought about it like that, but you are right.

 

Old familiar things seem to pop into my head from past things read, and thanks to the internet, it is relatively easy for my poor overburdened memory to refresh itself about them.   So it was with the subtitle of this little discourse's subtitle today, 'The pomp of courts, the pride of Kings.' 

 

I remembered it, but had to look up its context and detail, and I include that bit of historical diversion below the charts today.  It is an interesting little poetical puzzle and reminds us of a time when freedom of thought and press was much more constrained that it is now.

 

I find the world to be full of endlessly fascinating people and things, and books, travel, lectures, essays, and personal conversations are the pathways to them.  And the internet is a marvel of convenience for this.

 

This fascination with the world and the people in it is very much in the nature of Christian Humanism, which sees the things of the world in all their variety, but views little of His creation as inherently profane or evil, including human beings who can be a wonder and a source of grace.  It is we who make it so.

 

Evil is not a created thing, but the absence of good, a choice of free will.  The world is not inherently evil.  It inherently is, having no free will of its own  Plants and animals are not inherently evil, although the little girl has often put forward an exception to this for spinach and spiders. 

 

Creation is like a richly provisioned canvas on which we draw our lives, and it naturally shimmers in His light.   It is the darkness of our hardened hearts that casts images and shadows in the light. 

 

So the Christian humanist would agree with Socrates in saying, 'I am a citizen of the world,' but adding and most importantly, 'and nothing is alien to me except sin.'   Because it is in sin that we cut the connection between the Incarnate world and its Creator, for it is was in the almost shocking implications of the Incarnation that the world was refreshed and made new, as all things will be made new some day again.

 

Moving on to less complex but probably darker topics, Stocks were on a tear today,  shaking off the rather depressing economic reports of the morning.   One could speculate that this was a 'technical trade' ahead of a long weekend, with the wiseguys wishing to hand off more positions as we creep again back to new all time highs, buoyed with the central banks' hot money.  The futures are just about there.

 

But we could also attribute this to the announcement that Russia and the Ukraine have agreed to a cease fire (again).   That is one of the many geopolitical issues that have been weighing on the markets.  The other being Greece and the likely further deterioration of the Eurozone. 

 

As we saw, another central bank instituted QE and negative interest rates.  The world is slipping into a global depression.   The pig of the US economy has been lipsticked up and the Dollar is being presented as a safe haven.

 

Let's see how we go into the three day weekend, as on Monday the US will remember some of their Presidents.  I suppose a more popular day might be held in honor of all the ones which we might wish to forget, and they are many especially of late.

 

Have a pleasant evening.

 

 

 

 

"The pomp of courts, and pride of kings,

I prize above all earthly things;

I love my country, but my king,

Above all men his praise I'll sing.

The royal banners are displayed,

And may success the standard aid:

I fain would banish far from hence

The Rights of Man and Common Sense.

Destruction to that odious name,

The plague of princes, Thomas Paine,

Defeat and ruin seize the cause

Of France, her liberty, and laws."

Arthur O'Connor, The Society of United Irishmen, 1798

This poem above contains a hidden message, which was a hanging offense, for its day. Take the first line and follow with the first line of the second stanza, second line followed by the second line of second stanza and so forth.

Thus it becomes:

"The pomp of courts, and pride of kings,

I fain would banish far from hence

I prize above all earthly things;

The Rights of Man and Common Sense.

I love my country, but my king,

Destruction to that odious name,

Above all men his praise I'll sing.

The plague of princes, Thomas Paine,

The royal banners are displayed,

Defeat and ruin seize the cause

And may success the standard aid:

Of France, her liberty, and laws."