Stocks and Precious Metals Charts - All Is Well

Fed Vice Chair Stanley Fischer sought to reassure markets just after the close.

"On Wednesday, he [Stanley Fischer] said that spillovers from [rate] tightening 'will be manageable.'

It's possible that U.S. and foreign economic growth can align, Fischer said.  He added that downside risks from overseas are noticeably smaller and that foreign growth appears more entrenched.

Fischer said that China's economy also seems to be on more solid footing."

Stanley, you are not all that reassuring.  

This seems to be just another self-serving exercise from the Fed which wishes to get off the zero bound so that they can cut rates later on when their latest financial paper asset bubble starts deflating.

Stocks were wobbly into the close after giving up most of their gains after yesterday's loss.

I am not recommending going short, by the way.  These guys have more paper than you have patience.

Geopolitical jitters affecting the markets include the freedom wars in the Mideast and the Kid in North Korea.

And of course the rising populism in Europe, particularly with an eye to this weekend's French election which seems to be following the divergence from the status quo to both the left and right.

Metals were off on 'renewed US dollar strength' according to the financial spokesmodels, although if you look at the DX chart the 'strength' is greatly overstated.  Well, that's what they do.

Have a pleasant evening.

Stocks and Precious Metals Charts - What Is a Youth

"In one of his last speeches as Fed Chair, Bernanke bragged about how Fed didn't have info it needed in 2009 to say banks were solvent. How would Bernanke know?   He never took significant interest in the regulatory findings, simply followed assurances of others.  OCC was complicit in tolerating excesses of banks in the lead up to the Great Financial Crisis; in aftermath, teeth never shown.

Essentially, the Great Financial Crisis was result of widespread fraud on the part of sellers of 'securitized assets'. Books of banks masked huge SPE exposure. 'Opaque securities' were sold as investible quality but nothing more than mathematical approximations at time of issue. Yes, it became far more profitable to sell complex MBS risk baskets than identifiable, securitized assets

Were there villains?  Of course, there were.  Place to look was Wall Street.  It compensated much more for selling opaque securities. Well, there's that reality, too. I've been told by more than one current and former banker that the banks tell the regulators what the rules should be.

And let's keep in mind regulators let each bank devise its own, unique value at risk model, rendering stress tests highly unreliable. The Way governments ended doubts about solvency of opaque banks was with stress tests and pledge of taxpayer funds to maintain solvency."

Harald Malmgren

Uncle Buck took a dive today based largely on the British sterling component in the DX index. The PM Theresa May called for a general election in the UK seeking a strong Brexit mandate. She believes she will win it obviously.

Gold and silver were mixed in the NY trade, with silver finishing slightly off, but gold higher to end around 1290.

Stocks were weak, although the volumes remain relatively light and algo driven. Any serious event could crumble this market, but we are in that 'don't know don't care' phase of the bubble where a long term horizon is next week, and no one knows anything except to keep dancing while the music is playing.

Sincerity is the rarest of commodities.

And when mixed with an abiding love, the most precious.

Have a pleasant evening.

Stocks and Precious Metals Charts - Identities

“If you wanted to understand a politician you mustn’t pay too much attention to his speeches, but find out who were his paymasters.  A politician couldn’t rise in public life, in France any more than in America, unless he had the backing of big money, and it was in times of crisis like this that he paid his debts.

The great corporation which employed you lied to you, and lied to the whole country—from top to bottom it was nothing but one gigantic lie.”

Upton Sinclair


"To keep me from becoming conceited because of these surpassingly great revelations, there was given me a thorn in my flesh, a messenger of Satan, to torment me. Three times I pleaded with the Lord to take it away from me. But he said to me, 'My grace is sufficient for you, for my power is made perfect in weakness.' Therefore I will boast all the more gladly about my weaknesses, so that Christ’s power may rest on me. That is why, for the Lord's sake, I delight in weaknesses, in insults, in hardships, in persecutions, in difficulties. For when I am weak, then I am strong.

2 Corinthians 12:7-10

Great power and wealth rarely serve to bring out the best in a person. Rather to the contrary, it most often exposes and amplifies any of their weaknesses in character.

If a fellow was a duplicitous, greedy, self-serving, and double-dealing type before they came into power, it is highly unlikely that more wealth and more power will suddenly make them virtuous. The notion that a greedy person will somehow obtain enough and suddenly become empathetic is a fallacy. Greed knows no bounds and is never satisfied by its very nature. We can imagine ourselves having enough, perhaps, but that is because we are not greedy in the pathological sense.

Indeed, I think the mistaking of enormous wealth and power for virtue in the first place is one of the greatest errors of our culture.

One of the great exceptions you might think in US history was Franklin Roosevelt. However it ought to be noted that he inherited his money and family position. But it was through the infliction of a crippling disease, that affected him every day of his life, through which he obtained a genuine understanding of the human condition, and who he was. It was his affliction that gave him his greatness.

Again and again we see how those who have been granted great natural gifts and who use them to achieve good for others and not themselves are almost invariably afflicted in some way, some obstacle that prevents them from overreaching themselves, from forgetting who they really are, from falling victim to the belief in themselves above all.

Abraham Lincoln himself notes how circumstances in his life would bring him to his knees.

“I have been driven many times upon my knees by the overwhelming conviction that I had no where else to go.  My own wisdom and that of all about me seemed insufficient for that day.”

Those who can never see their own deficiency and errors and fundamental humanity, bringing them into empathy and kindness for others, a toleration for the mistakes and shortcoming that are a part of the human condition, are perhaps the saddest cases of all.   They have willingly blinded themselves, and others, to the true state of things, and will too often lead themselves and those who follow them into the abyss.

Gold and silver were rallying on Sunday evening on the increasing geopolitical risks.

However, volumes overall were light today, as several overseas exchanges remained closed and traders off work after the long holiday weekend.

And so the metals were sold, and stocks rallied on more puffery and nonsense.

Have a pleasant evening.