06 December 2018

Stocks and Precious Metals Charts - Mr. Trump's Wild Ride - Santa Takes One for the Team


"Half a league, half a league,
Half a league onward,
All in the valley of Death
Rode the six hundred.
‘Forward, the Light Brigade!
Charge for the guns!’ he said:
Into the valley of Death
Rode the six hundred.
‘Forward, the Light Brigade!’
Was there a man dismay’d?
Not tho’ the soldier knew
Someone had blunder’d."

Alfred Lord Tennyson, The Charge of the Light Brigade



“I think the Fed right now is a much bigger problem than China. I think it’s -- I think it’s incorrect what they’re doing.  I don’t like what they’re doing.  I don’t like the $50 billion.  I don’t like what they’re doing in terms of interest rates.

And they’re not being accommodative at all.  And I’m doing trade deals, and they’re great trade deals, but the Fed is not helping.”

Donald Trump

This would be funny if we were not stuck in the back seat of this crazy train.

Never in the field of financial endeavor have so many, been so roundly abused, by so few.

The Exchange Stabilization Fund stuffed Santa into a cannon this afternoon, and shot him into a hole in the popular narrative, plugging up the selling in stocks.

The turnaround was breathtaking, as the FANGS, minus AAPL, helped to lead the turnaround in US stocks that threatened to spoil the Christmas bonuses on Wall Street.

The buying panic was aided by Trump, who said "I didn't know" about the request for detention and extradition of the CFO of China tech giant, Huawei.

I suspect he will be saying "I didn't know" quite a bit for the rest of his term. It's the CEO thing to do.

Non-Farm Payrolls tomorrow.

Have a pleasant evening.







Bernie Sanders: Concentrated Wealth Is Concentrated Power


"I will never forget, Lloyd Blankfein, the head of Goldman Sachs, came to Congress a few years ago. And this is after the taxpayers of this country bailed them out because of their greed and their illegal behavior.  This is chutzpah.  These guys, after being bailed out by the middle class and working families of this country, after causing incalculable harm, which–the Wall Street crash cost us millions of jobs, people lost their homes, they lost their life savings.

These guys, after getting bailed out, they come to Congress.  They say, you know, what we think Congress should do is you gotta cut Social Security, and Medicare, and Medicaid.  And by the way, lower corporate tax rates and give more tax breaks to the wealthy. 

That’s power. That’s chutzpah.  We have it all, we can do whatever we want to do.  And I think the power of Wall Street—  you’ve got a half a dozen banks that own over 50 percent, equivalent to 50 percent of the assets in our GDP. 

And we have got to stand up to them."

Bernie Sanders

Financial reform is necessary and essential, but of little interest to the established elite.

And so it receives little attention and even less meaningful discussion.

They will discuss any other distracting issue, event, meaningless squabble and gossip, first.  They will play the fear card, and identity politics, but won't touch the flow of money that helps to make a few and their enablers, unbelievably rich.

The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustainable recovery.


The source and a transcript for this interview are here.





05 December 2018

Summary of Carroll Quigley's Last Public Lecture by Christopher Quigley


Summary of Prof. Carroll Quigley’s
Last Public Lecture Given Months Before He Died:
"The 3rd. Oscar Iden Lecture 1978"
By Christopher M. Quigley B.Sc., M.M.I.I., M.A.

“This shift from customary conformity to decision making by some other power, in its final stages, results in the dualism of almost totalitarian imperialism and an amorphous mass culture of atomised individuals.

The fundamental, all pervasive cause of World instability today is the destruction of communities by the commercialization of all human relationships and the resulting neurosis and psychosis.

Another reason for the instability of the Western system is that two of the main areas of sovereignty are not included in the state structure: control of credit/banking and corporations. These two elements are therefore free of political controls and responsibility.

They have largely monopolized power in Western Civilization and in American society. They are ruthlessly going forward to eliminate land, labour, entrepreneur-management skills and everything else the economists once told us were the chief elements of production.

The only element of production they are concerned with is the one they control: capital. Thus capital intensification has destroyed food, manufacturing, farming and communities. All these processes create frustrations on every level of modern human experience and result in the instability and disorder we see around everyday."

Carroll Quigley

In 1978 Professor Carroll Quigley, a few months before he died, gave three lectures at Georgetown University, Washington.  The lecture series was sponsored by a grant from the Oscar Iden endowment.

The genius of Carroll Quigley shone through his three presentations because, as always, he forced his audience to think.  His essays covered the thousand years of the growth of the State in the Western tradition from 976 – 1976. His approach went against the grain of most academics who only taught history in short sound bites.

Quigley believed that you could not understand anything unless you saw the whole, and the essence of his philosophy was that history is logical, i.e. things happen for a reason.  For him the core of all that occurs throughout the ages is the underlying force of fundamental human values.

Leaders, rulers and executives who miss this point are prone to make erroneous decisions because their actions will be based on flawed analysis and understanding. The professor saw that American society and Western Civilization were in serious trouble in the late 70’s. In hindsight his final essay The State of Individuals was particularly prophetic and events during the subsequent 32 years have exonerated his controversial conclusions.

In summary this essay stated the following:

Society is an organization of persons and artifacts to satisfy human needs.

Currently our desires are remote from our true needs. Societies are built on needs and they are ultimately destroyed through desires.

Power between the state and the society rests on the ability of the state to satisfy human needs. The state is a good state if it is sovereign and responsible.

There are seven level of culture or aspects of society: military, political, economic, social, emotional, religious and intellectual.

Military: men cannot live outside of groups. They can satisfy their needs only by co-operating within community. The group needs to be defended.
Political: If men operate within groups you must have a method to settle disputes.
Economic: The group must have organizational patterns for satisfying material needs.
Social: Man and women are social beings. They have a need for other people. They have a need to love and be loved.
Emotional: Men and women must have emotional experiences. Moment to moment with other people and moment to moment with nature.
Religious: Human beings have a need for a feeling of certitude in their minds about things they cannot control and do not fully understand.
Intellectual: Men and women have a need to comprehend and discuss.

Power is the ability in society to meed these eight fore-mentioned human needs.

Community is group of people with close inter-personal relationships. Without community no infant will be sufficiently socialized. Most of our internal controls which make society function have historically been learnt in community. Prior to 976 most controls in society were internal. In the West after 976 due to specialization and commercial expansion controls began to be externalized.

Sovereignty has eight aspects: defence, judicial, administrative, taxation, legislation, executive, monetary and incorporating power.

Expansion in society brings growing commercialization with the result that all values, in time, become monetized. As expansion continues it slows with the result that society becomes politicized and eventually militarized. This shift from customary conformity to decision making by some other power in its final stages results in the dualism of almost totalitarian imperialism and an amorphous mass culture of atomised individuals.

The main theme in our society today is [ruthless] competition, and no truly stable society can possibly be built on such a premise.  In the long term society must be based on association and co-operation.

From 1855 Western Civilization has shown signs of becoming increasingly unstable due to: technology and the displacement of labour: increased use of propaganda to brainwash people into thinking society was good and true; an increased emphasis on material desires; the increased emphasis on individualism over conformity; growing focus on quantity rather than quality; increased demand for vicarious satisfactions.

As a result more and more people began to comprehend that the state was not a society with community values. This realisation brought increasing instability.

Another element of the trend towards instability in Western Civilization was the growth in weapon systems that if actually used would ensure total destruction of the planet. This in effect meant that they were effectively redundant.

In addition the expansion of the last 150 years has in essence been based on fossil fuels. The energy which gave us the industrial revolution, coal – oil – natural gas – represented the combined savings of four weeks of sunlight that managed to be accumulated on earth out of the previous three billion years of sunshine.

This resource instead of being saved has been lost. Gone forever never to return. The fundamental all pervasive cause of World instability today is the destruction of communities by the commercialization of all human relationships and the resulting neurosis and psychosis.

Medical science and all the population explosions have continued to produce more and more people while the food supply and the supply of jobs are becoming increasingly precarious, not only in the United States, but everywhere, because the whole purpose of using fossil fuels in the corporate structure is the elimination of jobs.

Another reason for the instability of the Western system is that two of the main areas of sovereignty are not included in the state structure: control of credit/banking and corporations. These two elements are therefore free of political controls and responsibility. They have largely monopolized power in Western Civilization and in American society. They are ruthlessly going forward to eliminate land, labour, entrepreneur-management skills and everything else the economists once told us were the chief elements of production.

The only element of production they are concerned with is the one they control: capital. Thus capital intensification has destroyed food, manufacturing, farming and communities. All these processes create frustrations on every level of modern human experience and result in the instability and disorder we see around everyday.

Today in America there is a developing constitutional crisis. The three branches of government set up in 1789 do not contain the eight aspects of sovereignty. As a result each has tried to go outside the sphere in which it should be restrained. The constitution completely ignores, for example, the administrative power.

As a result the courts, in particular the Supreme court, is making decisions it should not be making. In addition the President, who by the constitution should be easily impeached, has become all powerful to such an extent that the office is now as basically Imperial.

However, to me the most obvious flaw in our constitutional set-up is the fact that the federal government does not have control over money and credit and does not have control over corporations. It is therefore not really sovereign and is not really responsible.

The final result is that the American people will unfortunately prefer communities. They will cop or opt out of the system. Today everything is a bureaucratic structure, and brainwashed people who are not personalities are trained to fit into it and say it is a great life but I think otherwise.

Do not be pessimistic. Life goes on; life is fun. And if a civilization crashed it deserves to. When Rome fell the Christian answer was. “Create your own communities."

Source:  The Oscar Iden Lecture Series Georgetown University Library: Prof. Carroll Quigley


04 December 2018

Stocks and Precious Metals Charts - Oh the Bovinity! - Stocks Battered for the Benefit of a Reckless Few


"Human beings are so made that the ones who do the crushing feel nothing; it is the person crushed who feels what is happening.  Unless one has placed oneself on the side of the oppressed, to feel with them, one cannot understand.

Power is as pitiless to the man who possesses it, or thinks he does, as it is to its victims; the latter it crushes, the former it intoxicates.  The truth is, no one really possesses it."

Simone Weil


"Education without values, as useful as it is, seems rather to make a man a more clever devil."

C. S. Lewis


"Nothing from the rising to the setting of the sun is enough for them.  Among all others only they are compelled to attack the poor as well as the rich.  Robbery, rape, and slaughter they falsely call empire; and where they make a desert, they call it peace."

Tacitus

One of the worst selloffs of the year.  Brought to you courtesy of the cleverest devils that money can buy.

The bulls certainly were pumped and dumped this week.  Oh the bovinity!

Who could have seen it coming?

Stocks sold off hard as the latest delusions, puffed up lies, and tweets deflated and fell flat.

The spokesmodels and very important people of finance found this steep sell off hard to accept, to the point of cognitive dissonance.

They searched for reasons for such a stunning, unexpected decline.

They looked for a reason at rising rates despite slack inflation with the narrowest of economic growth.

They examined global trade tensions, and the floundering of the proud British Tories in the face of Brexit.

They noted the deep disappointment of the narrow pack of bubblicious big cap darlings that had led the stock bubble higher, such as Apple.

But the hard truth is that these were all things that were in place before the latest pack of lies stroked our collective egos and drove stocks madly higher.   They knew that it was all a bunch of malarkey, but stocks were going up, so how could it be wrong?  Winning...

How unusual that equities fell back to earth when the latest delusional outlook was discovered to be priced to fantasy.

Gold and silver caught a bid in a safe haven move.   The Dollar moved sideways.  It was a risk off day.

The treasury yield curve is inverting on the very front end, which does not mean so much as the more classic 3m-10Y inversion, the technical term for which inversion is 'bad news.'

The US markets will be closed tomorrow in honor of George H. W. Bush.

We should close the markets in a memorial day for the truth, which we have allowed to be led down a blind alley of the unrestrained greed of a reckless few, and strangled.

Lord have mercy on us.

Have a pleasant evening.  See you on Thursday.