17 June 2015

Wall St Pleads For More Government Subsidies and Handouts In NYT Op-Ed


"It was the incarnation of blind insensate Greed. It was a monster devouring with a thousand mouths, trampling with a thousand hoofs: it was The Great Butcher — it was the spirit of Capitalism made flesh."

Upton Sinclair


"Greed is a bottomless pit which exhausts the person in an endless effort to satisfy the need without ever reaching satisfaction."

Erich Fromm

Surely you cannot be surprised by this headline.

Greed is incapable of having enough, by its very definition.

It does not need.  But it always wants-- more.

Wall Street Front Group Pleads for Government Help in New York Times OpEd
By Pam Martens and Russ Martens
June 17, 2015

After the U.S. government pumped the secret, astronomical sum of more than $13 trillion into Wall Street during the years surrounding the 2008 financial crisis to bail it out of its own greedy and reckless gambles, Wall Street is shamelessly asking for more government handouts in the opinion pages of the New York Times. The woman pitching this pathetic poppycock, Kathryn S. Wylde, was actually on the Board of Directors at the New York Fed during the crisis – the very institution that sluiced the secret $13 trillion into Wall Street’s coffers.

If you live outside of New York City, you’ve never heard of the Partnership for New York City. Even if you live inside New York City, unless you’re part of the black tie cocktail circuit, you’ve still never heard of the group. So when the New York Times gave a chunk of its opinion pages on Monday to Wylde as President and CEO of the Partnership for New York City to plead for government help for Wall Street, it really needed to do the ethical thing and fess up that this is a brazen front group for the financial services industry...

One sharp-eyed New Yorker caught this red flag in Wylde’s pitch in the New York Times when she was spinning how vital Wall Street is to the city’s economy. Wylde wrote:
“All told, the [financial services] industry accounts for 62 percent of private-sector wages in the city, and more than one-third of its $700 billion annual economic output. It contributes about $8 billion a year in city taxes — equivalent to the combined budgets of the city’s police, fire and sanitation departments — and one-quarter ($2.5 billion) of personal income taxes.”
A comment was posted by “David H” noting the following interesting math in the above:
“According to Ms. Wylde, the financial industry accounts for 62 percent of private-sector wages in the city, but only one quarter of personal income taxes. This strikes me as an empirical basis for a very different op-ed.”
Kelly Boling of Hudson, New York commented along the same lines:
“Let’s indeed invest in the infrastructure needed to keep New York globally competitive–and pay for it by requiring financial service executives to pay taxes on their incomes and capital gains at rates equal to the effective tax rates paid by New York’s middle class.”
...This shameless propaganda piece, in drag as an OpEd from some civic organization, was titled: “Yes, Wall Street Needs Help.” We certainly agree. But it’s more along the lines of psychiatric help for having the temerity to ask for a handout for its billionaires when the Coalition for the Homeless reports that the number of homeless New Yorkers sleeping in municipal shelters is 72 percent higher than a decade ago and has reached the highest levels since the Great Depression; when there are an estimated 1.3 million children and teens enrolled in public schools across the U.S. who are homeless – an 85 percent increase since the start of the Wall Street recession; and when Wall Street even gets tax perks to ghoulishly and secretly collect billions of dollars each year on the tragic deaths of workers...

Read the entire piece at Wall Street On Parade here.


Do not be surprised if there is another financial crisis, and the Banks come back again with a long list of demands, threatening chaos and despair if they are not swiftly granted all that they desire, either openly or secretively.  Why wouldn't they?

Remember Jesse's Law. 
Since money is power, the greater the concentration of money in a society, the greater will be the concentration of power.   And therefore the less free and broadly productive it will be, and the more inclined that this power will be to narrowly private abuses. 

Unregulated greed will rise to exceed and eventually overwhelm all rational expectations of theoretical market behavior because men are not angels.  And further, there is a determined minority in any society that is given over to irrational behavior and pathological obsessions that delights in abusing reason and rules, even to their own eventual destruction.

Rational expectations, and therefore market and social forces and their models, will fail when undermined by the unbridled greed for money and power.   

History proves this.
 

16 June 2015

Gold / SP 500 Ratio and the Short Term Trading Range In Gold


“And next time we hear someone saying something like, 'We are pursuing this strategy because other strategies, when we had considered them, we concluded that, in terms of overall effectiveness, they were not sound strategies, which is why we enacted the one we are now embarked upon, which our enemies would like to see us fail, because they hate freedom,' we will wait to see if the anchorperson cracks up, or chokes back a sob of disgust, and if he or she does not, we'll feel a bit insane, and therefore less confident, and therefore more passive.”

George Saunders, The Braindead Megaphone


“It’s almost been worth this Depression to find out how little our Big Men knew.”

Will Rogers

When privileged people repeatedly fail at a task, they quite often turn to harshness and even cruelty towards those whom they were purported to be helping, in a revulsion against their failed obligations.

Since they are geniuses, incapable of fault while maintaining their credibility which is founded upon their reputations and personal prestige, the people enduring their many plans themselves must have failed.  And so the people must be made to change, to improve,  and often to be chastised for their shortcomings.

And the financial masters will do this, almost piously, in the name of saving a system which in fact has become an extension of themselves, and which finally serves no one well but them.  

So no real reform can come, and little progress can be made, because the 'managers' are incapable of even admitting to their repeated failures out of self-preservation.   And they will excuse this in the name of preserving 'confidence.'

This is the credibility trap.





Gold Daily and Silver Weekly Charts - FOMC Rate Decision Tomorrow - Credibility Trap


"They took up several obviously wrong people, and they ran their heads very hard against wrong ideas, and persisted in trying to fit the circumstances to the ideas, instead of trying to extract ideas from the circumstances."

Charles Dickens, Great Expectations


"Oh what a tangled web we weave
When first we practice to deceive."

Sir Walter Scott, Marmion


“Reality denied comes back to haunt.”

Philip K. Dick

As you know from the economic calendar there will be the Fed's June Rate Decision tomorrow afternoon.

I doubt very much whether the Fed will actually do anything.

They *might* say something that will bring the 'will they or won't the raise' in September talk back to the forefront. But that is very premature until we see some signs of stabilization in Europe and Asia, and anything resembling a sustainable rebound in the States.

I never ceased to be amazed how little elite economists and the pampered Princes of Wall Street and the Beltway understand the working people of the country, in terms of what they do and how they think.

There should be little doubt that they consider the average person to be an apathetic, hapless fool, and they act accordingly.

And like the last two financial crises, there is not much doubt that they will be surprised once again.

Have a pleasant evening.


 
 
 


SP 500 and NDX Futures Daily Charts - Thermopylae


Stocks bounced a bit today, for largely technical reasons, ahead of the FOMC rate decision tomorrow.

The risks in equities remain pronounced and, in my own estimation, mispriced.
 
The risks of a craven demagogue or a pliant fool in the service of Big Money becoming the next President of the United States have gone exponential.

Have a pleasant evening.
 
 
 
 
 


 

15 June 2015

Gold Daily and Silver Weekly Charts - Credibility Trap


"While we were not watching, conspiracy theory has undergone Orwellian redefinition. A 'conspiracy theory' no longer means an event explained by a conspiracy. Instead, it now means any explanation, or even a fact, that is out of step with the government’s explanation and that of its media pimps...

In other words, as truth becomes uncomfortable for government and its Ministry of Propaganda, truth is redefined as conspiracy theory, by which is meant an absurd and laughable explanation that we should ignore."
Paul Craig Roberts

The Bucket Shop was quiet last Friday and today, as the usual punters were swapping stories and matching dollar bills for side bets.
 
There was a little spike in the precious metals as it was announced that the EU is preparing capital controls in the event of a Greek Default.
 
Keep an eye on these developments as I think that the powers that be are increasingly concerned that their fantastic (as in born of fantasy) plans are coming unraveled.
 
They do not know what they are doing but, of more concern, it is not clear that they even care, as long as they think that they are winning.
 
Have a pleasant evening.
 

 
 
 

SP 500 and NDX Futures Daily Charts - Roadhouse Blues


We saw a little flight to safety in the metals today, and a slump in equities that was overcome after the European markets closed.

This was all about concerns with a Greek default, and the weakness of the global banking system, and the not-very-exceptional weakness in the American economy.

Keep your eyes on the road and your hands on the wheel, as the song says.

Have a pleasant evening.