SP 500 and NDX Futures Daily Charts - Pop n' Flop

Stocks were rallying this morning on the 'better than expected' news about housing and consumer confidence.

As the day wore on, the punters apparently looked behind those numbers and did not like what they saw, and stocks ended up selling off on the day.

VIX has climbed back up a bit to a more 'normal' level of risk.

I had played an advantageous short position from last night, and cleared it out near the close.

The Dubai stock market crashed yesterday. Add that to the list, along with Argentina.

There is risk in these markets. It is just a question of what the trigger event might be, and of course when.

Have a pleasant evening.

The Recovery™ In One Graph

"Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country.

When you won, you divided the profits amongst you, and when you lost, you charged it to the bank.

You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin!

You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, (bringing his fist down on the table) I will rout you out!"

Andrew Jackson, On the Bank of the United States

"...supply-side economics was merely a cover for the trickle-down approach to economic policy — what an older and less elegant generation called the horse-and-sparrow theory: If you feed the horse enough oats, some will pass through to the road for the sparrows."

John Kenneth Galbraith

Recovery.  For some.

I am not sure what is trickling down in this recovery.  It is not oats, or wealth.

But I am fairly sure that I know why the recovery is so disjointed and selective.  

It is one of the oldest stories.  It is about the abuse of privilege, of foolish people led in herds shouting slogans crafted by the clever and the unscrupulous, of the treacherous and self-destructive fury of unbridled greed.

It is about the lust for power, the deceptiveness of hubris, the blindness of pride, and the lessons from history that have been carefully and intentionally unlearned.  It is about the madness that brings the fire, in hearts and minds of men.

 

 

h/t Anthony Sanders, Confounded Interest

Gold Daily and Silver Weekly Charts - Standing on the Deck of the Titanic

"Legitimate if you can, coerce if you have to, accommodate if you must."

Jürgen Habermas, as paraphrased by Robert Johnson

There was some interesting back and forth in the media about Germany's gold being held by the Federal Reserve today. You may read about it here.

The  objections to the article by Peter Boehringer seem to be a bit thin in parts.  While he stresses the 'independence' of the Bundesbank from the political process, he fails to note that the Buba never wanted to pursue the repatriation of the gold in the first place. 

It bowed to public political pressure after the embarrassment of their visit to New York in which they were not permitted to view the gold for 'security reasons.'  It seems fairly clear to me that the gold has been committed to the markets by the bullion banks.

Oh yes, it 'looks bad' for the Fed and the Bundesbank, but the real question is 'do they care?'  Perhaps it is time for a pressure check.

 

The US Congress has an approval rating of 7%.   Do they seem to care?  No, and the reasons why they do not care are not that hard to understand, even though we may not like them.  Nothing will change unless the existing equilibrium of the status quo and ruling elite changes, along with their sources of power and money.  And the same applies to Germany and the UK.

Nothing of note occurred in the Comex warehouses or deliveries on Friday.   But the Comex is becoming a Punch and Judy show.

The activity in the precious metals for this week's Comex July option expiration may be driven by silver which is in an active futures contract month.   Gold is not.

"The active contract months for silver will be March, May, July, September and December."

"The active contract months for gold will be February, April, June, August and December."