The Current Financial Asset Bubble in the DJIA - The Rake's Progress - 2001 Crash Metals Performance

My friend who has been creating this chart below seems rather exercised by the correlation. He has lots of charts showing the math behind it, and so forth.

What it says to me is that we are at a financial asset bubble top, which appears to have crested.

The old short seller in me knows that the resolution of this depends on what happens next.

While the 'signature' looks rather good, it must be confirmed by a market break, and then a failure of the powers of the financial system to rescue it.

I have been here many times before in the past forty years of trading.

A bull market makes everyone feel like a genius; a bear market crash brings them back down to their knees. Most investors and traders would do well to preserve what they have.

I have taken precautions for myself. You may wish to do the same.

But I am not yet actively shorting the market. This may say more about my current conservative stance towards trading.

In the early 2000's I would have been playing this to the downside, aggressively in-size and short term, in the futures markets.

But that is a younger man's game.

At some point we may see the safe havens come back into vogue. But it appears that is not yet the case.

In a general panic everything gets sold in a liquidation for the short term.

The only difference is the distribution of pain, and the speed at which some assets may rebound.

I include a relevant example from the 2001 crash below.

William Hogarth, The Rake in the Gambling Den Begging For God's Assistance

Stocks and Precious Metals Charts - Comex Option Expiration Tomorrow - Trump Says 25% Tariffs On China

After the bell Trump said he intends to impose the 25% tariffs on China now. The market was expecting this to happen after the first of the year, if ever.

Let's see if the futures sell off based on this latest assertion. Tweeter Trump says a lot of things that turn out not to be the true when cooler heads prevail.

I am starting to mark the retracement levels on the equity charts. Where this first bounce off bottom ends will tell us quite a bit.

Gold and silver were sideways today, ahead of the important December contract options expiration on precious metals tomorrow.

GM announced today that they would be closing 7-8 plants and cutting 14,000 jobs. MAGA!!

The Russians and Ukrainians are clashing on the sea. Russia seized three ships which they claimed had violated their waters and pursued illegal actions.

My sister-in-law drove home to northern Ohio yesterday, and was fortunate to miss a major snowstorm that is making its way across the Great Lakes today.

Here it is just raw and very rainy. Dolly wants no part of it, and is hiding her head in her blanket.

I did take her for a walk earlier before I went to the store, so I am content to stay parked under a blanket as well, drinking some soothing Tieguanyin tea.  It is also known as 'the Iron Goddess of Mercy.' That sounds like something from Game of Thrones, doesn't it?

Dare I have some home made soup for dinner?   With some hearty bread?  Yes, I think so. 

Cream of mushroom it is then.  With a little spicy kick to keep out the cold.

I basically use a recipe like this here.   But with some differences.

I add in a little more garlic and salt.  I use a good dried thyme instead of sprigs which I generally do not have handy.   I also add just a touch of rosemary.

I tend to use evaporated milk and a little more butter instead of heavy cream.  I saute everything in my big frying pan, and then put it into my Instant Pot slow cooker for an hour and a half at the normal temperature.  I deglaze the frying pan with sherry or rice wine and add that to the pot.

I might be tempted to add a touch of honey at the end and a little more salt if I think it needs it.

I use an immersion blender.  Not quite as smooth, but I like it a little more 'country.'  I am also lazy.

If I don't have a loaf of hearty bread handy I can use some frozen naan bread I buy in the 'family pack' at the local Indian grocery.  I glaze it with a soft butter, and lightly sprinkle it with a finely powdered garlic by McCormick that you can buy at Costco.  I keep it in a powdered sugar shaker.

I add a diced fresh jalapeno into the frying pan with the garlic.  I serve the soup with chopped scallions and a diced jalapeno for garnish.  Maybe some fresh cilantro.  My son likes it hot.  Me not so much.

Have a pleasant evening.

Update on the Comparison with Prior Notable Declines

The next few weeks will be interesting.

This is just the Dow Industrial Average, such as it is today.

By 'such as it is' I mean a grossly modified artifact of a dead theory that is pretty much useless.

We would have to see confirmation in the broader indices, rathern than the narrow DJIA and NDX, like the SP 500 and the Russell 2000.

Stocks and Precious Metals Charts - Black Friday

Stocks were weaker led lower on energy prices.

Have a pleasant weekend.

Thanksgiving - And Deliver Us From the Evil of Our Hardened Hearts

"Lord, I thank you for your faithfulness and love.

Though the Lord is exalted, he looks kindly on the lowly;
though lofty, he sees them from afar.
Though I walk in the midst of trouble,
you preserve my life.
You stretch out your hand against the anger of my foes;
with your right hand you save me.
The Lord will preserve me;
your love, Lord, endures for ever –
do not abandon us, the works of your hands."

Psalm 138


"Naked I came into this world from my mother's womb, and naked I will leave this life. The Lord giveth, and the Lord taketh away.   Blessed be the name of the Lord."

Job 1:21


"And now, bless the God of all,
who has done wondrous things here on earth;
Who fosters people’s growth from their mother’s womb,
and would fashion them well, according to his will.
May he grant you joy of heart,
and may peace abide among you."

Sirach 50:22-24


"Remember us, O Lord, in thy loving kindness and tender mercies, as ever they have been from old."

Psalm 25:6


"I have learned how to be content with whatever I have.  I know how to live on almost nothing, or with everything.  I have learned the secret of living in every situation.  And I have learned to be thankful, whether empty or full."

Phillipians 4:11-12


“Man has places in his heart which do not yet exist, and into them enters suffering, in order that they may have life.”

Léon Bloy

"Whereas it is the duty of all Nations to acknowledge the providence of Almighty God, to obey his will, to be grateful for his benefits, and humbly to implore his protection and favor, and whereas both Houses of Congress have by their joint Committee requested me "to recommend to the People of the United States a day of public thanksgiving and prayer to be observed by acknowledging with grateful hearts the many signal favors of Almighty God especially by affording them an opportunity peaceably to establish a form of government for their safety and happiness.

Now therefore I do recommend and assign Thursday the 26th day of November next to be devoted by the People of these States to the service of that great and glorious Being, who is the beneficent Author of all the good that was, that is, or that will be. That we may then all unite in rendering unto him our sincere and humble thanks, for his kind care and protection of the People of this Country previous to their becoming a Nation, for the signal and manifold mercies, and the favorable interpositions of his providence, which we experienced in the course and conclusion of the late war, for the great degree of tranquility, union, and plenty, which we have since enjoyed, for the peaceable and rational manner, in which we have been enabled to establish constitutions of government for our safety and happiness, and particularly the national One now lately instituted, for the civil and religious liberty with which we are blessed; and the means we have of acquiring and diffusing useful knowledge; and in general for all the great and various favors which he hath been pleased to confer upon us.

And also that we may then unite in most humbly offering our prayers and supplications to the great Lord and Ruler of Nations and beseech him to pardon our national and other transgressions, to enable us all, whether in public or private stations, to perform our several and relative duties properly and punctually, to render our national government a blessing to all the people, by constantly being a Government of wise, just, and constitutional laws, discreetly and faithfully executed and obeyed, to protect and guide all Sovereigns and Nations, especially such as have shown kindness unto us,  and to bless them with good government, peace, and concord...

Given under my hand at the City of New York the third day of October in the year of our Lord 1789."

George Washington

I have remembered all of you in my thoughts and prayers, as always, my brothers and sisters in Christ.   And I give thanks for you and your goodness.  Let us commend ourselves to His merciful forgiveness, and trust our futures to His loving kindness, and tender mercy.  Let us permit ourselves to be fashioned to His will, not for His sake, but for ours.

Remember to feed the least of His creatures, the birds and animals.  And the hearts of those you meet, with a kind word and a smile. 

Be kind to those who are around your table today, even those who may be 'difficult.'   And pray for His mercy and enlightenment if that difficult one is you.

Need little - Want less - Love more

Thanksgiving Menus— From Days Gone By

The prices have not been adjusted for inflation.