Stocks and Precious Metals Charts - Paper, Numbers, and Dreams

"While the crash only took place six months ago, I am convinced we have now passed the worst and with continued unity of effort we shall rapidly recover. There is one certainty of the future of a people of the resources, intelligence and character of the people of the United States-that is prosperity."

President Herbert Hoover, May 1, 1930


"The money was all appropriated for the top in the hopes that it would trickle down to the needy. Mr. Hoover was an engineer. He knew that water trickled down. Put it uphill and let it go and it will reach the driest little spot.

But he didn't know that money trickled up. Give it to the people at the bottom and the people at the top will have it before night anyhow. But it will at least have passed through some poor fellow’s hands.

They saved the big banks, but the little ones went up the flue."

Will Rogers, 5 December 1932


“The sense of responsibility in the financial community for the community as a whole is not small. It is nearly nil.”

John Kenneth Galbraith, The Great Crash of 1929

It was a risk on day, as the algos shook off any concerns and went into 'up mode.'

Big cap tech pushed to a new closing high.

But less noted in the enthusiastic commentary from the spokesmodels for Wall Street, the broader market continues to lag, badly.

The Russell 2000 still is not confirming this move.  I direct your attention to the first chart below.

This greatly undermines the hypothesis that this 'stock rally' is signalling that The Recovery™ is here at long last.

More likely, this is La Bubble Partie Trois.

Smells like another new era, and an inflation in paper financial assets as the Fed and the pampered politicos spread the new monetary wealth—  upwards to the favored few.

And some would give them yet even more freedom to print at will to solve our problems.  And this would make them suddenly virtuous how?

They have created enormous sums of money, and it continues to be misspent on nonsense for the benefit of the sectional monopolies like Big Pharma, Big Healthcare, Big Tech, and The Banks.

There is unrest bubbling under the surface of all of the major Western economies, from the US, to the UK, to France, and even stoic Germany.

"The American economy increasingly serves only a narrow part of society, and America's national politics has failed to put the country back on track through honest, open, and transparent problem solving. Too many of America's elites-among the super-rich, the CEOs, and many of my colleagues in academia-have abandoned a commitment to social responsibility. They chase wealth and power, the rest of society be damned."

Jeffrey Sachs, The Price of Civilization, January 2012

Have a pleasant evening.

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.

Stocks and Precious Metals Charts - Risk Off - Maundy Thursday

"Jesus stood up from the meal, took off his outer clothing, and wrapped a towel round his waist. After that, he poured water into a basin and began to wash his disciples’ feet, drying them with the towel that was wrapped round him.

He came to Simon Peter, who said to him, ‘Lord, are you going to wash my feet?’

Jesus replied, ‘You do not realise now what I am doing, but later you will understand.’

‘No,’ said Peter, ‘you shall never wash my feet.’

Jesus answered, ‘Unless I wash you, you have no part with me.’

‘Then, Lord,’ Simon Peter replied, ‘not just my feet but my hands and my head as well!’

When he had finished washing their feet, he put on his clothes and returned to his place. ‘Do you understand what I have done for you?’ he asked them. ‘You call me Teacher and Lord, and rightly so, for that is what I am. Now that I, your Lord and Teacher, have washed your feet, you also should wash one another’s feet. I have set you an example that you should do as I have done for you.

A new commandment I give you: that you love one another, as I have loved you. By this all will know that you are mine— if you have love for one another.'”

John 13


"What we would like to do is change the world–make it a little simpler for people to feed, clothe and shelter themselves as God intended them to do. And to a certain extent, by fighting for better conditions, by crying out unceasingly for the rights of the workers, of the poor, of the destitute–the rights of the worthy and the unworthy poor in other words, we can to a certain extent change the world; we can work for the oasis, the little cell of joy and peace in a harried world. We can throw our pebble in the pond and be confident that its ever widening circle will reach around the world."

Dorothy Day, June 1946

Today was a 'risk off' day in the markets.

Some of this was due to geopolitical risks.

The rest was in anticipation of a three day weekend, with new political and geopolitical risks being anticipated.

The US government, specifically the Congress, has to renew the debt ceiling, and despite being controlled by one party it remains dysfunctional, being sharply divided by ideologues and servants of various corporate interests and a wealthy few who do not carry the needs and best outcomes for the people or the nation in their hearts.   And as for the corporate powers, they serve only their own greed, which is mammon.

Few suffering servants in power these days; they serve what they love the most, a false vision of god as themselves, which is death. It would be far better for them if they had never been born.

Gold and silver remain jammed into key resistance, and both of the major stock indices which I track here closed down to key support.

VIX, the measure of risk and volatility, has ticked up to a new short term high.

Let's see if we can come out of this weekend blithely, and reverse these trends next week. Or on the other hand, confirm these trends with breakouts and breakdowns as the mispricing of risk that began with the Trump ascendancy starts to unwind.

This is Holy Week for us. And so I will likely not post anything tomorrow, but perhaps some little things over the weekend. I spent much of today taking care of the queen, who is very fatigued and forgetful because of her illness. I managed to do all her laundry which was a major milestone. She was too tired to object, because I won't 'do it the right way.' lol.

Have a pleasant weekend.