03 February 2016

SP 500 and NDX Futures Daily Charts - Risorgimento



After the bell they were missing earnings, or making the earnings and missing the revenues, or some reasonable facsimile thereof.

Stocks did a big midday turnaround off the lows, because 'oil showed some strength' and the dollar was taking the short term siesta and falling over.

Right now it appears on both charts that we have a decent chance of forming continuation patterns, either a bear flag or a symmetrical triangle. The bear flag has a higher chance of moving lower next, with the symmetrical triangle still bearish but not quite as much.

The economic news continues to stink up the place.

Today had all the hallmarks of a very technical move designed by the pros and algos to shake out the 'investors.' It is like Planet of the Apes, with the short term insiders as the gorillas, having all the horses and weapons, and spend their days hunting down the rest of us, the human beings.

They are not smarter. Don't give cheaters that kind of praise. This is not a market anymore; this is a carney sideshow, three card monty.  But they are not too lazy to steal, I will give them that.  Too bad they can stick their hands into your pockets via Washington even if you are not playing their games directly anymore.

Have a pleasant evening.











Currency Wars and 'The Big Reset'


"We now have arrived at the point where it is not the banks, but the countries themselves that are getting in serious financial trouble. The idea that we can ‘grow our way back’ out of debt is naive.

The current solution to ‘park’ debts on to the balance sheets of central banks is just an interim solution. A global debt restructuring will be needed, as economists Rogoff and Reinhart recently explained in their working paper for the IMF. This will include a new global reserve system to replace the current failing dollar system, probably before 2020."

Willem Middelkoop, The Big Reset Part I


"The wealth of another region excites their greed; and if it is weak, their lust for power as well. 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, Agricola, circa 98 AD

It is remarkable how similar my conception of this is in parallel, and has been in this vein for quite a long time, as it seemed to be the inevitable path given the financial situation and its history as I saw it as far back as 2002.

As you know, my thought arose out of a study of 'crashes' I started in 1996, which branched out to a broader study of the role of finance and money.

I think we are still in the 'negotiating' phase of this currency war as I have called it, rather than 'Big Reset.'

I find Middelkoop to be fascinating.  I obviously do not agree with everything he says.  For example, I do not attribute the fall or Rome to the debasement of their currency, which I see as a symptom of the real problem of a more general debasement.

Rome fell because its productivity shifted from 'real things' and innovations in war and engineering to colonialism and the manipulation of power, a kind of financializaton.  It brought a rule by terror and the exporting of tyranny which hollowed the best of their society out from the inside. This cycle of corruption and excess brought an increasingly horrible and self-referential ruling class into power,  people privileged by birth and by ruthless dishonesty, until the empire collapsed from the edges into the very heart of it.

In a very real sense, Rome died of a terminal lack of honesty, virtue, and merit.  The financial and the ruling class become as one without respect to productivity.  And this is ironic because as the Empire declined, the lip service of their leaders to the old standards of 'Roman virtue' become ever louder and more mockingly false.  People will blame the mob, but Rome died from the top down.

Bear in mind that the American President that is next elected will be the leader of the dollar cartel going into this critical time. I would not assume that their interests will be fully aligned with those of the greater majority of the American people.

Given our experience in global trade deals for example, I suggest that there is a very good reason to hope that the political establishment is overturned, and to be wary of the status quo of politics and business as they are now.

The 'privileged class' in the West have become dangerously isolated, unsympathetic to the condition of the people, and brazenly self-serving in their rationalizations for a long series of horrendous policy decisions.

The more 'flexible' this new currency is, the more disastrous the inequality of the distribution of the pain will be.   Giving this government great latitude in creating a new money out of nothing is like giving gangster the keys to the Treasury.  I do not think that anything could be more clear that the more power they obtain, the greater and more frequent the abuses of it will be.

Now is no time to give unqualified trust to an imaginary theory of benign plutocrats ruling with the wisdom and nature of angels.  And this is why I am so adamantly opposed to the utopian notion of willful moneyprinting without fear of consequence or harm.

At odds with this theory of immutable solvency, history has shown, over and over again, that this is a license for looting by the select few for themselves and their friends.  And we already have one foot on the edge of that abyss.

Money is power, and in times of general corruption power must be, even more than in normal times, transparent, held to accounts, and restrained by a broader consensus.

And to say we do not have this now is an understatement.     That does not imply that we swing to the other extreme and allow these same plutocrats to impose austerity for the many, and even more comforts and privileges for themselves.

A return to 'hard money' itself is no panacea as I have noted before, because a system that is broken and self-serving can turn every good thing to ill purposes.   Their power serves only itself.  How can anything good come from a system ruled by ambitious, pathological liars in the service of sociopaths and serial criminals who have no decency, no moral reckoning, no fear of punishment, and no shame?

And if history serves, those who attempt to turn a crisis to their personal advantage will soon find themselves tied to the back of a tiger they cannot control.  But unfortunately their greed for money and power exceeds not only their wisdom but their common sense as well, and the truly Big Money will not listen, even until the end.

But perhaps the courtiers and their servants will become duly concerned as they should be, because when it comes to it the plutocrats will throw them off the backs of their fleeing sleds as food for the pursuing wolves.  And above all they should know that this is the case with these empty shells of distorted humanity.

Reform, fair administration of justice, and transparency are the sine qua non.

It will be an interesting time, if history is any guide.




"The problem of the last three decades is not the 'vicissitudes of the marketplace,' but rather deliberate actions by the government to redistribute income from the rest of us to the one percent. This pattern of government action shows up in all areas of government policy."

Dean Baker


"Most of them became wealthy by being well connected and crooked. And they are creating a society in which they can commit hugely damaging economic crimes with impunity, and in which only children of the wealthy have the opportunity to become successful. That’s what I have a problem with. And I think most people agree with me."

Charles Ferguson, Predator Nation


Tsar Nicholas II:   I know what will make them happy. They are children, and they need a Tsar! They need tradition. Not this!  They are the victims of agitators. A Duma would make them bewildered and discontented.  And don't tell me about London and Berlin. God save us from the mess they're in!

Count Witte:  I see. So they talk, pray, march, plead, petition and what do they get? Cossacks, prison, flogging, police, spies, and now, after today, they will be shot.  Is this God's will?  Are these His methods?  Make war on your own people?  How long do you think they're going to stand there and let you shoot them?  YOU ask ME who's responsible?  YOU ask?

Tsar Nicholas II:  The English have a parliament. Our British cousins gave their rights away. The Hapsburgs, and the Hoehenzollerns too. The Romanovs will not. What I was given, I will give my son.

02 February 2016

Gold Daily and Silver Weekly Charts - More 'Flight To Safety' - Active February


Gold showed some strength today in an add on to the flight to safety trade, even though there was a midday hit on price that was pure antics. The dollar moved lower and silver wallowed.

I posted an update to the NAV of Precious Metals Funds and Trusts today. Sprott has successfully absorbed the Central Gold Trust. It raised some cash and added substantially to their bullion and shares under management, so its a good deal for them. Let's see if time shows if it is a good deal for the trust unit holders.

But that NAV report shows the gold/silver price ratio around 78, which is historically very high. This is I think one indication that this is a 'flight to safety' into gold for the moment.

And February is an 'active month' for gold and that shows in the delivery report from The Bucket Shop which has seen 62,800 ounces of gold 'delivered' on the February contract so far.

Silver has seen not nearly as much action, and the amount of registered for delivery silver bullion is now shockingly low as silver goes. I have high hopes for silver this year, but not while the precious metals are rallying as a safe haven.

But I would say that if I happened to hold any gold or silver bullion as a longer term holding, I would not have it in any unallocated form, or in storage associated with the Western metals trade. I can definitely see a short squeeze as a possibility, and as we learned from MF Global, possession is nine-tenths of the law.

The 'cup and handle' formation for gold remains viable but not formed or activated.

As an aside, just by way of setting the level and not being too cryptic or misleading, my wife of 38 years has a stage IV colo-rectal cancer that at least for now has no cure. But they can control it, manage it somewhat, through surgery and chemotherapy, and they have been doing so for about five years. I have gotten to know the US healthcare system quite well. We have an excellent oncologist whom we just adore and a first class hospital in a large metropolitan area. This is why we are still here.

So on occasion I may be out of pocket, and there is no mystery to it. This is our life now. It is something we do, bearing up with the good and the ill, thanking all for His tender mercies. And I am with her every step of the way. I told her that I would be the day we first found out on a routine colonoscopy and they thought it was discovered early enough, but it was not.

What doctors do not understand about cancer even now is often a surprise to many. It is much better now than when my mother and father passed away from it some years ago, but it is still heavy on treatments which are expensive and non-specifically destructive.

And there are many different forms of cancer and they are not all the same. And each cancer can act differently and peculiarly from patient to patient, ebbing and flowing in their appearances, so many can get attracted to certain 'cures' that are correlated to a particular situation, a remission, but without genuine causation. The key factor seems to be to find a very good doctor in a very good and forward looking, patient oriented setting.

I also learned quite a bit more about prostate cancer lately, in addition to watching my father pass away from it ten years ago, but thankfully need to learn no more as it was good news. I will say that the biopsy for prostate cancer is surprisingly uncomfortable. And some of the misinformation floating about is also surprising, even among otherwise informed and intelligent people who again confuse anecdotal 'cures' with scientific cause and effect.

And this is just my impression, but too often research is being driven by private grants and money, and commercial incentives. I think the government is missing a huge opportunity here and for all the worst reasons.

I just wanted to put that issue on the table so you will understand my absences going forward as they occur. I don't need any real help on this, but your prayers are always welcome, always, as I remember you all, and I do.

Have a pleasant evening.









SP 500 and NDX Futures Daily Charts - Hard Down


Stocks were on the downslide today after not so good economic news in the US this morning as noted in the economic calendar below, and perhaps more importantly another down day for oil.

As you know I had suggested some time ago that we had made a short term bottom. And that we were likely to see a largely technical rally that might go higher than you might think, maybe 20-30% retracement.

But unless something substantial changes in the global outlook, that then we might see that rally fail and we could go back down and not only retest the low, but set a new one. At the time I suggested we *could* see 1770 on the SP 500 futures.

I'll stick with that for now.  But I have added a trendline in blue to the chart to give myself some idea of what any shorter term corrections might look like, as opposed to another big move down lower.

Yahoo after the bell.

Have a pleasant evening.





NAV Premiums of Certain Precious Metal Trusts and Funds


Having completed the acquisition of the Central Gold Trust, the Sprott Physical Gold Trust now reflects that additional bullion and the cash assets obtained through the transaction through the disposition of bullion.

Obviously the Central Gold Trust is no longer listed and has ceased to exist.

The Sprott Silver Trust has sold some bullion to raise cash and is now well funded.

The Central Fund must address their cash position, either through a bullion sale or a secondary offering.


01 February 2016

Administrative Note, Mostly


“It's time for the United States to start thinking of Iraq as a business opportunity," she [Secretary of State Hillary Clinton] said in a 2011 speech.

The quote was included in an email released by the State Department on Wednesday that specifically mentioned JPMorgan and Exxon Mobil. JPMorgan was selected by the U.S. government to run a key import-export bank in Iraq and in 2013 announced plans to expand its operations in the country.

Exxon Mobil signed a deal to redevelop Iraqi oil fields. JPMorgan has collectively paid the Clintons and the Clinton Foundation at least $450,000 for speeches, and Exxon Mobil has donated over $1 million to the family’s foundation.

David Sirota, Hillary Pitched Iraq As a 'Business Opportunity'

I will be out of pocket for the rest of the day, with somewhat constrained access to the internet.

I will be at hospital while my wife undergoes a colonoscopy.

I am sure we will be going out to eat after that since she has been fasting since yesterday morning.

I am posting some links from the waiting room.

So there will be no chart updates tonight.

Postscript:   Great results, and now out to dinner, thanking God for His tender mercies.