While the prices of gold and silver take a beating in the futures market, two weeks out from the wanton slaughter (8/11) and a week since the infamous Money Daily post declaring their historic comeback (8/18), the past week has seen a nearly continuous dilution in the price of both metals, for no apparent good reason.
Gold and silver continue to be in high demand and short supply. Perhaps the supply issues are not as pronounced as they were at the start of the COVID-19 pandemic scare, but they are still pre-eminent, demonstrated by continued high dealer premiums, quantity limits, and shipping delays. It's been a harrowing time for dealers trying to keep up with demand while at the same time attempting to stay profitable. Wild price swings render their operations unwieldy and difficult. Stability might serve them - and the buying pubic - better.
As the prices of both metals soared and then soured, the question of value has to come to mind, if only to allay fears that recent buying might not be found to be in vain. Buyers from dealers and open markets such as eBay are still paying premiums, and those open market buyers are getting delivery at a faster pace. Price is always and everywhere a prime consideration, so seriously, how much is an ounce of gold really worth?
For the purposes of this exercise - the first of its kind (with hopefully many more to come) - let's put aside the arguments over the inflated value of fiat currencies and other considerations centered on floating values as are the major currencies in use today. They are a measurement tool for now. Nothing more, nothing less, and are handy for the purpose of determining a price point for gold, and by extension, everything.
The world's know gold supply is roughly 200,000 tons. That's a rough estimate, but useful, even if somewhat inaccurate, in this arguably simplistic quest for valuation. 200,000 tons is equivalent to 6,400,000,000 (six billion, four hundred thousand) ounces. One ton equates to 32,000 ounces, and that's standard, not troy, but the numbers are good enough for this exercise. That's roughly how much gold has been mined and is in somebody's hands, or in vaults, central bank reserves, etc.
Now, there are nearly eight billion people living on planet Earth. That's a number that can change, and with it, so too should the price of gold. If the natural path of civilization - or, what's left of it - continues, the gorwth of the world's population is calculable and that should be a contributing factor to pricing gold because in the end, it's people who should own gold, especially if it's going to be regarded as currency, and, yes, it should be global.
So, we have 6.4 billion ounces of gold and 7.8 billion people, which is not enough gold for even every person to own one ounce. If that should become a standard (1 ounce per person), that would necessitate using a divisor to determine price and that same divisor could be and should be adjusted at some set schedule, be it continuously (a dangerous prospect, prone to manipulation and gaming) or monthly, quarterly, or annually.
It should be kept in mind that gold production will also increase the amount of proven gold above ground, so it is possible that the divisor would be somewhat constant, as gold production - as we can clearly see from the numbers - roughly keeps pace with population growth.
In an entirely egalitarian environment, everybody would have one ounce of gold. When a person died, that ounce would be handed down to the next newborn, and that process would be repeated constantly, globally. While that's an impractical scenario, it serves the purpose of this experiment.
So, the divisor for one ounce of gold per person on the planet would be a single, simple equation, the number of ounces of gold, divided by the global population, or, presently, 6.4(B)/7.8(B) = 0.82.
The next step would be to determine at what level - in some currency, be it yen, euro, dollar, pound, etc. - an ounce of gold would be reasonably worth.
Let's arbitrarily determine that human life is worth something, anything, remembering that fiat currencies are wildly inflated in value as opposed to purchasing power. Let's say an ounce of gold would be equivalent to a down payment on a modest, 1000 square foot house and let's assume the price of such a house in the US would be $100,000, requiring a 20% down payment, or $20,000.
Then, we take our completely arbitrary figure of $20,000 and apply the divisor, thus ($20,000 X 0.82) to arrive at a price for one ounce of gold. Our result is $16,400, and that price would then be the global standard which could be used as a determinant for everything else, such as silver, which, using one of the time-honored ratios of either 16:1 or 12:1 or even 10:1, depending on how one calculates the overground global supply of silver, would be either $1025, $1367, or $1640, respectively.
Bear in mind that this is just a mind exercise. It does not mean that gold should be $16,400 an ounce or that silver should be $1000 an ounce or anything else. It does point up that gold at $2000 and silver at $26 per ounce seems a bit on the short side. Using our derived method, at that price, one would be putting down $2000 on a house with a value of a mere $10,000, which might be enough for a shanty hut in the outer regions of Indonesia, but hardly suitable for living quarters in New York city, Marseille, France, or even rural Iowa.
Of course, there can be more variables, or other determinants. One could calculate the price of gold as compared to the price of a live chicken, for example, or use any other widely-used commodity as a relation. What's a hammer priced in gold? A watch, an iPhone, a window, a fattened cow... The possibilities are endless, but what's essential is some form of standard beyond faith in a floating currency which has no intrinsic value. We could have a gold-iPhone standard, a chicken-gold standard, even a acreage-silver standard.
A straight gold standard with silver as a useful currency is reasonable and actually practical.
Hope you enjoyed this little experiment. Arguably, this exercise was done hastily and with many arbitrary and changeable numbers. There could be errors, but the point is that a better means must be devised for valuation of all things. The era of fiat money, created out of thin air, at interest, is coming to an end. It is imperative that some other form of measurement be established to bring global order. Gold serves this purpose as an ultimate arbiter of value, given that a reasonable and reliable value can be put upon it itself.
Come back soon. This was hopefully illustrative and promise to do more.
At the Close, Monday, August 24, 2020:
Dow: 28,308.46, +378.13 (+1.35%)
NASDAQ: 11,379.72, +67.92 (+0.60%)
S&P 500: 3,431.28, +34.12 (+1.00%)
NYSE: 12,972.88, +163.81 (+1.28%)
Showing posts with label fiat. Show all posts
Showing posts with label fiat. Show all posts
Tuesday, August 25, 2020
Thursday, June 11, 2020
Fed To Keep Rates At ZERO Through 2022; Are Gold and Silver Investors Batty?; Implications of Global Madness
If Forex is in your wheelhouse, you've no doubt noticed the recent decline in the US dollar against other major currencies. The Dollar Index has been pretty shaky as of late, but the current trend in the aftermath of the worst of the coronavirus pandemic is lower, with no bottom in sight.
After sinking to 94.89 on the 3rd of March, the dollar leapt back to an interim high of 102.82 on March 20th. Wednesday's quote was 95.96, a decline of nearly seven precent, most of that happening within the last three weeks.
That's not surprising, given that American cities have been beset upon by hordes of protesters, complete with rioters, looters, cop killings, tear gassings, rubber bullet maimings, autonomous zones (Seattle's Capitol Hill is one, recently claimed and occupied by protesters as police vacated the 3rd Precinct) and general lawlessness, making dollar holdings somewhat of a risky bet in the near term and, as dollar dominance recedes, maybe for much longer.
At the conclusion of the Fed's Tuesday and Wednesday's FOMC policy meeting, Chairman Jerome Powell made a definitive statement on interest rates, saying that the overnight federal funds rate would remain at the zero-bound at least until 2022. That kind of central bank sentiment doesn't exactly inspire confidence in the world's reserve currency. It indicates nothing less than a failure of financial system underpinning, a condition that first appeared in 2007, was not adequately addressed and has now become a systemic crisis without hope of positive resolution.
While the Fed still has the monetary muscle to backstop financial assets it does so with counterfeit, a fictional fiat currency without backing that eventually will be worthless. History has shown this to always be the case. Fiat currencies die and a new financial system is erected. Normally, the new system is backed by gold or silver, or a combination of the two. This time is no different than any other. The Federal Reserve and other central banks can continue their charade for only so long. Eventually, income disparity results in runaway inflation and widespread poverty, prompting clamor from the masses, which we are witnessing on a global scale today as an epochal societal revolution.
Such incalculable convulsions encourage escape from the clutches of unfair finances promulgated by central banks. People seek refuge from currencies that are losing value rapidly. Housing, health care, and eventually, food become unaffordable to the vast swath of middle and lower classes. Alternatives are sought. Gold and silver are the most readily available to the public. Silver becomes particularly of interest due to its lower price points. The availability of metallic money becomes a point of contention as people with limited means crowd into the space, which is exactly what's happened since the onset of the coronavirus.
A 10 troy ounce gold bar at Apmex.com is offered for $18,255.90. At Scottsdale Mint, the popular one ounce silver bar dubbed "The One" starts at $25.05 and goes down in price to $23.42 depending on quantity and method of payment. Of course, given that one would be willing to pay a price that carries a premium of seven dollars over spot, one would be out of luck, as "The One" is currently out of stock.
These are just a few examples of what happens when a confluence of events (pandemic, endless fiat currency creation, summer-long protests, high unemployment, rampant inflation) strikes the minds of people with money and assets. They either go with the flow and stay in stocks or look to gold and/or silver for some safety. With bonds yielding little to nothing - sometimes less than that via negative rates - and default risk rising (hello, Argentina!), precious metals offer a reasonable alternative.
Futures and spot prices for the precious metals might as well be cast upon stones for what they fail to deliver in terms of price discovery. Being holdovers from the failing fiat regime, they are being left behind as physical holdings dominate the marketplace. Prices are exploding on eBay and at dealers, as shown in the examples above. Money Daily tracks prices on eBay for one ounce gold and silver coins and bars weekly in it's Weekend Wrap every Sunday.
Other ways to deploy currency are in art, collectibles (comic book prices are through the roof), vintage automobiles, commodity futures, real estate, ad other asset classes, but none of those share the characteristics of precious metals as real money, except possibly cryptocurrencies like Bitcoin.
Wall Street, the Federal Reserve, and the federal government are hanging onto their prized positions of monetary and political authority by their teeth. It's only a matter of time before all of it fails. The nationwide protests are proof that the federal government is losing control of the country in manifest ways. Unrelenting gains in precious metal prices - and the attendant, repeated attempts to contain those gains in the futures markets - is evidence of the Fed's desperation, just as Wall Street's recent snapback rally is a mirage based on easily available fiat currency and nothing else.
It's all tumbling down and there's nothing that can stop it. The demise of the dollar has been an ongoing orgy of dislocation for decades. Trillions of dollars added to the Fed's balance sheet, euros at the ECB, yen at the Bank of Japan, yuan at at PBOC are mere stop-gap measures which do not address the underlying solvency issues. If the stock market crash in March wasn't enough to scare people out of stocks and fiat, the coming wave will surely devastate those who failed to heed the warning. Via the Fed's emergency measures, Wall Street has given investors a golden opportunity to diversify out of stocks. Those who fail to take the opportunity will suffer a heavy economic blow.
At the Close, Wednesday, June 10, 2020:
Dow: 26,989.99, -282.31 (-1.04%)
NASDAQ: 10,020.35, +66.59 (+0.67%)
S&P 500: 3,190.14, -17.04 (-0.53%)
NYSE: 12,449.22, -170.30 (-1.35%)
After sinking to 94.89 on the 3rd of March, the dollar leapt back to an interim high of 102.82 on March 20th. Wednesday's quote was 95.96, a decline of nearly seven precent, most of that happening within the last three weeks.
That's not surprising, given that American cities have been beset upon by hordes of protesters, complete with rioters, looters, cop killings, tear gassings, rubber bullet maimings, autonomous zones (Seattle's Capitol Hill is one, recently claimed and occupied by protesters as police vacated the 3rd Precinct) and general lawlessness, making dollar holdings somewhat of a risky bet in the near term and, as dollar dominance recedes, maybe for much longer.
At the conclusion of the Fed's Tuesday and Wednesday's FOMC policy meeting, Chairman Jerome Powell made a definitive statement on interest rates, saying that the overnight federal funds rate would remain at the zero-bound at least until 2022. That kind of central bank sentiment doesn't exactly inspire confidence in the world's reserve currency. It indicates nothing less than a failure of financial system underpinning, a condition that first appeared in 2007, was not adequately addressed and has now become a systemic crisis without hope of positive resolution.
While the Fed still has the monetary muscle to backstop financial assets it does so with counterfeit, a fictional fiat currency without backing that eventually will be worthless. History has shown this to always be the case. Fiat currencies die and a new financial system is erected. Normally, the new system is backed by gold or silver, or a combination of the two. This time is no different than any other. The Federal Reserve and other central banks can continue their charade for only so long. Eventually, income disparity results in runaway inflation and widespread poverty, prompting clamor from the masses, which we are witnessing on a global scale today as an epochal societal revolution.
Such incalculable convulsions encourage escape from the clutches of unfair finances promulgated by central banks. People seek refuge from currencies that are losing value rapidly. Housing, health care, and eventually, food become unaffordable to the vast swath of middle and lower classes. Alternatives are sought. Gold and silver are the most readily available to the public. Silver becomes particularly of interest due to its lower price points. The availability of metallic money becomes a point of contention as people with limited means crowd into the space, which is exactly what's happened since the onset of the coronavirus.
A 10 troy ounce gold bar at Apmex.com is offered for $18,255.90. At Scottsdale Mint, the popular one ounce silver bar dubbed "The One" starts at $25.05 and goes down in price to $23.42 depending on quantity and method of payment. Of course, given that one would be willing to pay a price that carries a premium of seven dollars over spot, one would be out of luck, as "The One" is currently out of stock.
These are just a few examples of what happens when a confluence of events (pandemic, endless fiat currency creation, summer-long protests, high unemployment, rampant inflation) strikes the minds of people with money and assets. They either go with the flow and stay in stocks or look to gold and/or silver for some safety. With bonds yielding little to nothing - sometimes less than that via negative rates - and default risk rising (hello, Argentina!), precious metals offer a reasonable alternative.
Futures and spot prices for the precious metals might as well be cast upon stones for what they fail to deliver in terms of price discovery. Being holdovers from the failing fiat regime, they are being left behind as physical holdings dominate the marketplace. Prices are exploding on eBay and at dealers, as shown in the examples above. Money Daily tracks prices on eBay for one ounce gold and silver coins and bars weekly in it's Weekend Wrap every Sunday.
Other ways to deploy currency are in art, collectibles (comic book prices are through the roof), vintage automobiles, commodity futures, real estate, ad other asset classes, but none of those share the characteristics of precious metals as real money, except possibly cryptocurrencies like Bitcoin.
Wall Street, the Federal Reserve, and the federal government are hanging onto their prized positions of monetary and political authority by their teeth. It's only a matter of time before all of it fails. The nationwide protests are proof that the federal government is losing control of the country in manifest ways. Unrelenting gains in precious metal prices - and the attendant, repeated attempts to contain those gains in the futures markets - is evidence of the Fed's desperation, just as Wall Street's recent snapback rally is a mirage based on easily available fiat currency and nothing else.
It's all tumbling down and there's nothing that can stop it. The demise of the dollar has been an ongoing orgy of dislocation for decades. Trillions of dollars added to the Fed's balance sheet, euros at the ECB, yen at the Bank of Japan, yuan at at PBOC are mere stop-gap measures which do not address the underlying solvency issues. If the stock market crash in March wasn't enough to scare people out of stocks and fiat, the coming wave will surely devastate those who failed to heed the warning. Via the Fed's emergency measures, Wall Street has given investors a golden opportunity to diversify out of stocks. Those who fail to take the opportunity will suffer a heavy economic blow.
At the Close, Wednesday, June 10, 2020:
Dow: 26,989.99, -282.31 (-1.04%)
NASDAQ: 10,020.35, +66.59 (+0.67%)
S&P 500: 3,190.14, -17.04 (-0.53%)
NYSE: 12,449.22, -170.30 (-1.35%)
Thursday, May 14, 2020
Intent on Self-destruction, the Fed and Washington Politicians Should Be Encouraged to Get On With It
Two straight days of losses should have some investors a little concerned that all the money the Federal Reserve is using to prop up markets may not be enough.
Especially frightful is the short term head and shoulders pattern the Dow has printed, raising the possibility for another serious downturn that could leave the Fed outflanked, flummoxed, and low on ammunition.
Considering that the recent move forward off the March lows was anything other than an aberration predicated on the vacuuming up of voluminous amounts of debt by the central bank is just wishful thinking. After all, the entire planet is being ravaged - societally and economically - by a pandemic, the likes of which have not been seen in over 100 years. Stocks should have been sold right into the trash pile. Instead, the past six weeks have primarily demonstrated the Fed's ability to meddle in the natural functions of what used to be a free market. While profits were deteriorating at a manic pace the Fed saw fit to massage market integrity with bubble-gum, candy, and ice cream, looking past the most obvious and painful resolution to overpriced, overvalued equities: a quick crash and revaluation at lower levels, bankruptcies for the least protected or most egregiously offensive, and a sober look at systemic solvency.
Acting more like an overprotective soccer mom than a steward of principled financial policy, the Fed managed the nearly impossible feat of taking an already-overvalued market to even greater levels of investment insanity, throwing ridiculous amounts of capital and liquidity into a hyperventilated landscape on the verge of collapse.
It's high time for the Fed and the president to back away from the punch bowl of fiat fantasy and allow the market to determine for itself where it wishes to go, though the likelihood of that happening are about the same as Dr. Fauci speaking out of only one side of his mouth.
The president wants negative rates and while the Fed protests against the lunacy of capital destruction, they will eventually comply because that's all they know how to do. When all you have is a hammer, everything looks like a screw, so it's a safe bet that when push comes to shove - sending the major indices back into bear market territory where they belong - the Fed will no doubt begin to engage in financial hari kari.
By introducing negative rates, they will have effectively given up all hope for salvation of the capitalist system, punishing investors and savers even more than a zero-interest rate policy has for the past two decades, now insisting that bond holders lose money and currency is flattened under the steamroller of failed radical policy.
It's one thing to want to rescue a company or an industry from default or liquidation, but the folly and sheer egotistical panache of trying to save an entire economic system is on the table and being gorged upon by the inmates at the Federal Reserve. The panicky regional presidents and FOMC governors are about to put on a show for the ages, demonstrating, for anyone interested, how a group of supposedly intelligent men and woman can openly conspire to their own demise. With every shovelful of capital they feed to the market, the deeper they dig their own grave, with ample assistance from Washington politicians intent on not being outdone. Congress will compete with the Fed for lunatics of the century by doing on the fiscal side about what the Fed is doing on the monetary side, abandoning any remnant of financial discipline by exploding the federal budget with deficits wider than the Grand Canyon.
The American public should allow it. In fact, we should cheer on their efforts emphatically from our stay-at-home prisons. Since the public isn't allowed to go to sporting events or concerts, garden shows or lectures, the least they can do is encourage the people who masterminded this economic mishmash to demolish the antiquated, decrepit, malfunctioning miasma of governance, economy, and policy as quickly as possible, because then, a new functioning system can begin to evolve, one that hopefully does not include elected morons and economic theorists of central planning.
As predictable as day turns to night, the old gives way to the new. If those atop the pyramids of power wish to willfully fling themselves from the their perches, they should be allowed and even encouraged to do so.
It will hasten the pain and speed the healing.
At the Close, Wednesday, May 13, 2020:
Dow: 23,247.97, -516.81 (-2.17%)
NASDAQ: 8,863.17, -139.38 (-1.55%)
S&P 500: 2,820.00, -50.12 (-1.75%)
NYSE: 10,829.44, -226.14 (-2.05%)
Especially frightful is the short term head and shoulders pattern the Dow has printed, raising the possibility for another serious downturn that could leave the Fed outflanked, flummoxed, and low on ammunition.
Considering that the recent move forward off the March lows was anything other than an aberration predicated on the vacuuming up of voluminous amounts of debt by the central bank is just wishful thinking. After all, the entire planet is being ravaged - societally and economically - by a pandemic, the likes of which have not been seen in over 100 years. Stocks should have been sold right into the trash pile. Instead, the past six weeks have primarily demonstrated the Fed's ability to meddle in the natural functions of what used to be a free market. While profits were deteriorating at a manic pace the Fed saw fit to massage market integrity with bubble-gum, candy, and ice cream, looking past the most obvious and painful resolution to overpriced, overvalued equities: a quick crash and revaluation at lower levels, bankruptcies for the least protected or most egregiously offensive, and a sober look at systemic solvency.
Acting more like an overprotective soccer mom than a steward of principled financial policy, the Fed managed the nearly impossible feat of taking an already-overvalued market to even greater levels of investment insanity, throwing ridiculous amounts of capital and liquidity into a hyperventilated landscape on the verge of collapse.
It's high time for the Fed and the president to back away from the punch bowl of fiat fantasy and allow the market to determine for itself where it wishes to go, though the likelihood of that happening are about the same as Dr. Fauci speaking out of only one side of his mouth.
The president wants negative rates and while the Fed protests against the lunacy of capital destruction, they will eventually comply because that's all they know how to do. When all you have is a hammer, everything looks like a screw, so it's a safe bet that when push comes to shove - sending the major indices back into bear market territory where they belong - the Fed will no doubt begin to engage in financial hari kari.
By introducing negative rates, they will have effectively given up all hope for salvation of the capitalist system, punishing investors and savers even more than a zero-interest rate policy has for the past two decades, now insisting that bond holders lose money and currency is flattened under the steamroller of failed radical policy.
It's one thing to want to rescue a company or an industry from default or liquidation, but the folly and sheer egotistical panache of trying to save an entire economic system is on the table and being gorged upon by the inmates at the Federal Reserve. The panicky regional presidents and FOMC governors are about to put on a show for the ages, demonstrating, for anyone interested, how a group of supposedly intelligent men and woman can openly conspire to their own demise. With every shovelful of capital they feed to the market, the deeper they dig their own grave, with ample assistance from Washington politicians intent on not being outdone. Congress will compete with the Fed for lunatics of the century by doing on the fiscal side about what the Fed is doing on the monetary side, abandoning any remnant of financial discipline by exploding the federal budget with deficits wider than the Grand Canyon.
The American public should allow it. In fact, we should cheer on their efforts emphatically from our stay-at-home prisons. Since the public isn't allowed to go to sporting events or concerts, garden shows or lectures, the least they can do is encourage the people who masterminded this economic mishmash to demolish the antiquated, decrepit, malfunctioning miasma of governance, economy, and policy as quickly as possible, because then, a new functioning system can begin to evolve, one that hopefully does not include elected morons and economic theorists of central planning.
As predictable as day turns to night, the old gives way to the new. If those atop the pyramids of power wish to willfully fling themselves from the their perches, they should be allowed and even encouraged to do so.
It will hasten the pain and speed the healing.
At the Close, Wednesday, May 13, 2020:
Dow: 23,247.97, -516.81 (-2.17%)
NASDAQ: 8,863.17, -139.38 (-1.55%)
S&P 500: 2,820.00, -50.12 (-1.75%)
NYSE: 10,829.44, -226.14 (-2.05%)
Monday, November 20, 2017
Stocks Ignore Political Risks, China Regulations; Glint App Takes Gold Digital
Early morning in Europe and the Western Hemisphere were looking downright dreary to open the week's financial escapades, until buyers (central banks) emerged from the shadows (crypts), quickly erasing concerns over China's new rules to crimp the burgeoning shadow banking uprising and the failure of German Chancellor Angela Merkel to form a coalition government.
While futures were down sharply - especially on the European news - they were quickly corrected. China's markets quickly went from negative, staging a day-long rally, while European bourses were mostly positive and US stocks rallied sharply from the opening bell.
However, the euphoria flagged in the US as the session wore on, with stocks finishing off their highs of the day. Still, the results were much more cheerful than what might have happened if markets and investors were left alone, barring the blatant interventionism that seems to pervade trading in all markets.
The new paradigm is such that stocks cannot fail, but only go higher, valuations be damned, while gold and silver are routinely taken out to the woodshed for a weekly beating, such as occurred this morning, prior to the opening bell on Wall Street and throughout the day.
The setup isn't all so new at all. Since 2012, gold and silver have been mercilessly suppressed, to the point at which some staunch supporters are rethinking their love for shiny metals. This is exactly what central bankers wish, that wealth protectors give up and resign themselves to the fiat money regimen, but it is also precisely the time - if one is guided by sound investment stratagems - to begin loading up on what most would be shunning.
In that regard, London-based Glint launched a mobile app today that sets gold sailing into the digital age, offering Glintpay as a means by which to hold gold in a Swiss-based vault with the ability to spend one's holdings via a complementary MasterCard.
The app, which is available for download through the Apple App Store, works on iPhones and iPads using Apple's iOS operating system and is promising to provide quick and easy debit access to gold and a host of other currencies, with millions of locations worldwide accepting MasterCard.
How well the start-up will fare is an open question, but it does raise an interesting alternative to Bitcoin and other cryptocurrencies, which have witnessed monumental growth over the past six months and continue to raise eyebrows in the conventional banking universe.
The world is at a crossroads in terms of currencies. Trust in the debt-slavery central bank system continues to wane in various places as the rise of cryptos offers a glimpse of a possible future and precious metal devotees cling to long-held beliefs in money that is backed by physical assets.
Currency events are historically long-winded affairs, taking years or decades in which to sort themselves out. The ongoing forays between fiat, crypto, and physical seems to have gained some momentum today.
Investors with an eye on the global financial landscape would be wise to hold some of each, allocating more toward the digital and physical as events warrant as old systems are dying and may have been dealt an unrecoverable blow during the Great Financial Crisis of 2007-09.
At the Close, Monday, November 20, 2017:
Dow: 23,430.33, +72.09 (+0.31%)
NASDAQ: 6,790.71, +7.92 (+0.12%)
S&P 500: 2,582.14, +3.29 (+0.13%)
NYSE Composite: 12,320.77, +17.88 (+0.15%)
While futures were down sharply - especially on the European news - they were quickly corrected. China's markets quickly went from negative, staging a day-long rally, while European bourses were mostly positive and US stocks rallied sharply from the opening bell.
However, the euphoria flagged in the US as the session wore on, with stocks finishing off their highs of the day. Still, the results were much more cheerful than what might have happened if markets and investors were left alone, barring the blatant interventionism that seems to pervade trading in all markets.
The new paradigm is such that stocks cannot fail, but only go higher, valuations be damned, while gold and silver are routinely taken out to the woodshed for a weekly beating, such as occurred this morning, prior to the opening bell on Wall Street and throughout the day.
The setup isn't all so new at all. Since 2012, gold and silver have been mercilessly suppressed, to the point at which some staunch supporters are rethinking their love for shiny metals. This is exactly what central bankers wish, that wealth protectors give up and resign themselves to the fiat money regimen, but it is also precisely the time - if one is guided by sound investment stratagems - to begin loading up on what most would be shunning.
In that regard, London-based Glint launched a mobile app today that sets gold sailing into the digital age, offering Glintpay as a means by which to hold gold in a Swiss-based vault with the ability to spend one's holdings via a complementary MasterCard.
The app, which is available for download through the Apple App Store, works on iPhones and iPads using Apple's iOS operating system and is promising to provide quick and easy debit access to gold and a host of other currencies, with millions of locations worldwide accepting MasterCard.
How well the start-up will fare is an open question, but it does raise an interesting alternative to Bitcoin and other cryptocurrencies, which have witnessed monumental growth over the past six months and continue to raise eyebrows in the conventional banking universe.
The world is at a crossroads in terms of currencies. Trust in the debt-slavery central bank system continues to wane in various places as the rise of cryptos offers a glimpse of a possible future and precious metal devotees cling to long-held beliefs in money that is backed by physical assets.
Currency events are historically long-winded affairs, taking years or decades in which to sort themselves out. The ongoing forays between fiat, crypto, and physical seems to have gained some momentum today.
Investors with an eye on the global financial landscape would be wise to hold some of each, allocating more toward the digital and physical as events warrant as old systems are dying and may have been dealt an unrecoverable blow during the Great Financial Crisis of 2007-09.
At the Close, Monday, November 20, 2017:
Dow: 23,430.33, +72.09 (+0.31%)
NASDAQ: 6,790.71, +7.92 (+0.12%)
S&P 500: 2,582.14, +3.29 (+0.13%)
NYSE Composite: 12,320.77, +17.88 (+0.15%)
Monday, July 24, 2017
For US Markets, It's Splits-ville Again
Another day, another session punctuated by divergent indices.
The NASDAQ goes up; the Dow goes down, or vice versa. The S&P 500 and NYSE Composite seem to go their own ways, more often than not, separate. All of this reeks of manipulation, selectivity, goal-seeking, and just about anything other than rational investing.
Upon examination, the stock market is nothing more than pieces of paper representing shares in company X or Y or Z, being traded for other pieces of paper known as yen, dollars, euros or pesos. It's the ultimate paper chase, based entirely on faith and foolery of grand design by the world's central bankers. It's a confidence game being played at the highest levels of finance, a dangerous precedent for the entire planet.
Unless the public detaches from the fraud, it will continue. The unique phenomenon at work in today's financial arenas is commonly known to psychiatrists as normalcy bias. It is the belief that everything seems to be working all right, so the urge to change is minimized, which is precisely the condition present in the debt-infested governments, businesses, and households everywhere.
The ultimate fear is that confidence is lost in the fiat system. After eight long years of propping up governments, businesses, and households with freshly-printed-or-minted cash, confidence is still durable, thanks to normalcy bias.
But, there are canaries in the coal mine, so to speak. These are burgeoning, non-repayable government debt, underfunded pensions (especially public union pensions), slack demand, disinflation, demographics, and the undeniable eventuality of recession, either in the US, Europe, or globally.
Fighting these trends with some degree of success has been the role of the central banks, but they are running out of viable options to keep global finance operating while also quelling local discontent, which is growing rapidly.
Money Daily does not pretend to know who is buying stocks and/or causing the variations in the major indices, but it is apparent that some entity other than brokerages are buying and it is well known that the Bank of Japan (BOJ), Swiss National Bank (SNB), and European Central Bank (ECB) have been and will continue to be outright buyers of equities.
When these entities become sellers, there will be no bottom to the markets.
Caveat Emptor.
At the Close, 7/24/17:
Dow: 21,513.17, -66.90 (-0.31%)
NASDAQ: 6,410.81, +23.05 (0.36%)
S&P 500: 2,469.91, -2.63 (-0.11%)
NYSE Composite: 11,904.71, -19.89 (-0.17%)
The NASDAQ goes up; the Dow goes down, or vice versa. The S&P 500 and NYSE Composite seem to go their own ways, more often than not, separate. All of this reeks of manipulation, selectivity, goal-seeking, and just about anything other than rational investing.
Upon examination, the stock market is nothing more than pieces of paper representing shares in company X or Y or Z, being traded for other pieces of paper known as yen, dollars, euros or pesos. It's the ultimate paper chase, based entirely on faith and foolery of grand design by the world's central bankers. It's a confidence game being played at the highest levels of finance, a dangerous precedent for the entire planet.
Unless the public detaches from the fraud, it will continue. The unique phenomenon at work in today's financial arenas is commonly known to psychiatrists as normalcy bias. It is the belief that everything seems to be working all right, so the urge to change is minimized, which is precisely the condition present in the debt-infested governments, businesses, and households everywhere.
The ultimate fear is that confidence is lost in the fiat system. After eight long years of propping up governments, businesses, and households with freshly-printed-or-minted cash, confidence is still durable, thanks to normalcy bias.
But, there are canaries in the coal mine, so to speak. These are burgeoning, non-repayable government debt, underfunded pensions (especially public union pensions), slack demand, disinflation, demographics, and the undeniable eventuality of recession, either in the US, Europe, or globally.
Fighting these trends with some degree of success has been the role of the central banks, but they are running out of viable options to keep global finance operating while also quelling local discontent, which is growing rapidly.
Money Daily does not pretend to know who is buying stocks and/or causing the variations in the major indices, but it is apparent that some entity other than brokerages are buying and it is well known that the Bank of Japan (BOJ), Swiss National Bank (SNB), and European Central Bank (ECB) have been and will continue to be outright buyers of equities.
When these entities become sellers, there will be no bottom to the markets.
Caveat Emptor.
At the Close, 7/24/17:
Dow: 21,513.17, -66.90 (-0.31%)
NASDAQ: 6,410.81, +23.05 (0.36%)
S&P 500: 2,469.91, -2.63 (-0.11%)
NYSE Composite: 11,904.71, -19.89 (-0.17%)
Wednesday, June 1, 2011
A Major Dose of Reality and the Beginning of the End of Paper Money
Confirming yesterday's hypothesis that "something is wrong," stocks righted themselves to the steady flow of horrible economic news on wednesday and took their largest losses in months.
What really sent the markets into a deep funk was the release of the ADP private payroll survey, which showed job gains for the month of May to be only 38,000, when most estimates ranged from 175,000 to as high as 300,000. That sent futures tumbling in the hour just prior to the open and stocks did a complete reversal from Tuesday's glorious rally, which, truth be told, was based on nothing but hot air, or even cold air, but air, nonetheless.
Once traders had tasted the bitter flavor of selling winners and losers alike, the ISM manufacturing index came in at 10:00 am, well below expectations of 57.0, at 53.5, after notching a 60.4 handle in April. Despite still being positive (above 50), it was the worst reading since the fall of 2009.
Lumped on top of Tuesday's Chicago PMI and Case-Shiller housing report, the first week of June looks like it may be a tide-turning one. The euphoria of Tuesday's happy-face rally all but extinguished, investors, economists and government talkers must face the grim reality that the economy is sputtering, even after trillions in stimulus over the past two-and-a-half years.
The fallout from the long series of poor to horrible economic reports was that the benchmark 10-year note fell to its lowest level since last summer, checking in at 2.94%, after closing at 3.06 yesterday. Sub-3% yields on the 10-year is swell for borrowers, but it also belies a grim truth: that the economy is dead in the water, and there is nowhere to go but into the relative safety of fixed income, albeit at very unattractive yields.
Dow 12,290.14, -279.65 (2.22%)
NASDAQ 2,769.19, -66.11 (2.33%)
S&P 500 1,314.55, -30.65 (2.28%)
NYSE Composite 8,281.59, -195.69 (2.31%)
Declining issues overwhelmed advancers, 5420-1222. It was the biggest rout of 2011. Still hanging on for dear life, the new high-new low indicator showed the NASDAQ dead even at 74 new highs and the same number of new lows. On the NYSE, a bit more resilience, with 101 new highs and 38 new lows, though once again, the margin is shrinking and it's only a matter of time before the market flips right over and a full-blown correction can be announced.
Naturally, since nobody wants or likes to face the reality of the situation, the US and global economies are almost completely kaput. Nothing more than wasted effort printing worthless Dollars, Euros and Yuan will be the requisite response from the league of central bankers whose policies have been exposed as outright disasters. A great reckoning is upon us, and those who have not prepared will be blind-sided and left in tears with paper assets worth nothing.
Volume was on a par with Tuesday's, unsurprisingly, though one could have expected even heavier selling. Apparently, not everyone is convinced that the game is over. The Too Big To Fail banks are still holding out hope for more dollar devaluation for the Fed and more handouts via the strapped and wrecked taxpayer base.
Of the more curious aspects of today's global melt-down was that the dollar actually looked like the best of a bad lot, rising 0.364 to 74.90, though that condition is - as the Chairman might express - transitory. Eventually, all paper money will be debased to nothing as the world sinks into global depression.
NASDAQ Volume 2,316,268,250
NYSE Volume 4,920,608,500
Of some small consolation to millions of consumers, oil fell abruptly, down $2.41, to $100.29. While still about $25 higher than it should be, the price of crude and the resultant price of gasoline should ease over the coming days and weeks to reflect the true status of the economy. Nothing kills growth as quickly or completely as high oil and gasoline prices, and, even though demand has been falling steadily since the average price of a gallon of unleaded gas hit just below $4.00, the price still remains a drag on the overall economy, at $3.77.
Gold was the greatest beneficiary of Wall Street's loathsome session, hitting a two-month high at $1551.20, before falling back to $1539.10, up $4.10 on the day. Naturally, the central banking cartel could not let silver go untouched, smashing the second precious metal down $1.65, to $36.82. Of course, in a deflationary depression, the metals offer no great relief, though they will tend to outperform all other asset classes and when the collapse of all fiat money occurs, they will shine as saviors.
June is shaping up to be a killer for the stock markets. Even though the ADP employment report has been widely criticized, there's little doubt that Friday's non-farm payroll report for May will be nothing short of disastrous, showing quite clearly that all the stimulus and wanton speculation of the past two years has done nothing to repair the deep wounds to the Main Street economy.
What little hope there is can be found amongst those who believe it is time for honesty and a change of policy, that people be favored over wealthy banks and their criminal CEOs and that government, if unable to serve the needs of the people, will be left behind. As during other times of hardship, the American public will turn to barter, black markets and other underground economies. Governments at all levels will be left holding onto unwieldy deficits as tax receipts fail to materialize.
The more one pays attention to what comes out of the mouths of bankers, government officials and elected legislators, the more one comes to realize that they have no interest but their own at heart and the American people will carry on without them, even if it means wholesale tax rebellion at every level. The system is burdened with unassailable costs and debts that cannot be paid. When and if congress decides to actually come to grips with these harsh realities, we will begin healing, though most with any sense of history feel that government has lost all control and the people are about to begin fending more or less for themselves.
Of course, the government will continue kiting checks to the "needy" and keeping the masses at bay with food stamps and other entitlement outlays, but the value will continue to erode and the already well-entrenched, wretched sub-class of welfare and government dole recipients will suffer even more.
It is truly a remarkable time in the world's history, and probably better to be young than old, for the young have the advantage of time - to repair, replenish and rebuild that which our absent leaders have destroyed.
What really sent the markets into a deep funk was the release of the ADP private payroll survey, which showed job gains for the month of May to be only 38,000, when most estimates ranged from 175,000 to as high as 300,000. That sent futures tumbling in the hour just prior to the open and stocks did a complete reversal from Tuesday's glorious rally, which, truth be told, was based on nothing but hot air, or even cold air, but air, nonetheless.
Once traders had tasted the bitter flavor of selling winners and losers alike, the ISM manufacturing index came in at 10:00 am, well below expectations of 57.0, at 53.5, after notching a 60.4 handle in April. Despite still being positive (above 50), it was the worst reading since the fall of 2009.
Lumped on top of Tuesday's Chicago PMI and Case-Shiller housing report, the first week of June looks like it may be a tide-turning one. The euphoria of Tuesday's happy-face rally all but extinguished, investors, economists and government talkers must face the grim reality that the economy is sputtering, even after trillions in stimulus over the past two-and-a-half years.
The fallout from the long series of poor to horrible economic reports was that the benchmark 10-year note fell to its lowest level since last summer, checking in at 2.94%, after closing at 3.06 yesterday. Sub-3% yields on the 10-year is swell for borrowers, but it also belies a grim truth: that the economy is dead in the water, and there is nowhere to go but into the relative safety of fixed income, albeit at very unattractive yields.
Dow 12,290.14, -279.65 (2.22%)
NASDAQ 2,769.19, -66.11 (2.33%)
S&P 500 1,314.55, -30.65 (2.28%)
NYSE Composite 8,281.59, -195.69 (2.31%)
Declining issues overwhelmed advancers, 5420-1222. It was the biggest rout of 2011. Still hanging on for dear life, the new high-new low indicator showed the NASDAQ dead even at 74 new highs and the same number of new lows. On the NYSE, a bit more resilience, with 101 new highs and 38 new lows, though once again, the margin is shrinking and it's only a matter of time before the market flips right over and a full-blown correction can be announced.
Naturally, since nobody wants or likes to face the reality of the situation, the US and global economies are almost completely kaput. Nothing more than wasted effort printing worthless Dollars, Euros and Yuan will be the requisite response from the league of central bankers whose policies have been exposed as outright disasters. A great reckoning is upon us, and those who have not prepared will be blind-sided and left in tears with paper assets worth nothing.
Volume was on a par with Tuesday's, unsurprisingly, though one could have expected even heavier selling. Apparently, not everyone is convinced that the game is over. The Too Big To Fail banks are still holding out hope for more dollar devaluation for the Fed and more handouts via the strapped and wrecked taxpayer base.
Of the more curious aspects of today's global melt-down was that the dollar actually looked like the best of a bad lot, rising 0.364 to 74.90, though that condition is - as the Chairman might express - transitory. Eventually, all paper money will be debased to nothing as the world sinks into global depression.
NASDAQ Volume 2,316,268,250
NYSE Volume 4,920,608,500
Of some small consolation to millions of consumers, oil fell abruptly, down $2.41, to $100.29. While still about $25 higher than it should be, the price of crude and the resultant price of gasoline should ease over the coming days and weeks to reflect the true status of the economy. Nothing kills growth as quickly or completely as high oil and gasoline prices, and, even though demand has been falling steadily since the average price of a gallon of unleaded gas hit just below $4.00, the price still remains a drag on the overall economy, at $3.77.
Gold was the greatest beneficiary of Wall Street's loathsome session, hitting a two-month high at $1551.20, before falling back to $1539.10, up $4.10 on the day. Naturally, the central banking cartel could not let silver go untouched, smashing the second precious metal down $1.65, to $36.82. Of course, in a deflationary depression, the metals offer no great relief, though they will tend to outperform all other asset classes and when the collapse of all fiat money occurs, they will shine as saviors.
June is shaping up to be a killer for the stock markets. Even though the ADP employment report has been widely criticized, there's little doubt that Friday's non-farm payroll report for May will be nothing short of disastrous, showing quite clearly that all the stimulus and wanton speculation of the past two years has done nothing to repair the deep wounds to the Main Street economy.
What little hope there is can be found amongst those who believe it is time for honesty and a change of policy, that people be favored over wealthy banks and their criminal CEOs and that government, if unable to serve the needs of the people, will be left behind. As during other times of hardship, the American public will turn to barter, black markets and other underground economies. Governments at all levels will be left holding onto unwieldy deficits as tax receipts fail to materialize.
The more one pays attention to what comes out of the mouths of bankers, government officials and elected legislators, the more one comes to realize that they have no interest but their own at heart and the American people will carry on without them, even if it means wholesale tax rebellion at every level. The system is burdened with unassailable costs and debts that cannot be paid. When and if congress decides to actually come to grips with these harsh realities, we will begin healing, though most with any sense of history feel that government has lost all control and the people are about to begin fending more or less for themselves.
Of course, the government will continue kiting checks to the "needy" and keeping the masses at bay with food stamps and other entitlement outlays, but the value will continue to erode and the already well-entrenched, wretched sub-class of welfare and government dole recipients will suffer even more.
It is truly a remarkable time in the world's history, and probably better to be young than old, for the young have the advantage of time - to repair, replenish and rebuild that which our absent leaders have destroyed.
Tuesday, May 3, 2011
Ponzi Schemes, Bubbles and Manipulation Rampant in US Markets
What follows bizarre?
On the absurdity scale, probably irrational, or maybe unbelievable.
That's exactly where US markets are now and for the foreseeable future - or until about the middle of June. Nothing makes sense on the surface, but there are correlations. Below the surface are machinations of big money players, central banks, the Too Big To Fail banks here in the US and Europe and whatever whacky game they're playing in the two biggest Eastern economies - China and Japan.
Consider that the dollar index spent the overnight gaining, fell sharply during the morning in the US, spent the next two hours rising, and ended the day with two hours of flatness, resulting in a final prinat at 4:00 pm EDT of 73.095, a paltry gain of 0.051, hardly a blip on anyone's radar.
Now, the Dow did follow along at the end, though it made all of its gains, back to a small print higher for the day, in the final hour of trading, bouncing back from a 50-point loss.
Meanwhile, silver had its worst one-day decline since the Hunt Brothers got wiped out in 1980. Sure, silver was overvalued on a very short-term basis, but the meaning of the massive, manipulated crash was to get the price back down to where JP Morgan and the rest of the shorts wouldn't be losing theirs. The attacks since Sunday night on the paper silver market, in conjunction with margin hikes by the COMEX, have had the desired effect. Silver is down, the US dollar will live for another day, week, a few months, maybe even until the presidential election in 2012.
Oil finally had its comeuppance, for a day, but if anything is a bubble, it is not silver, which has been suppressed for decades, or gold, which has broken out of the stranglehold of the big banks, but oil and stocks. Crude oil has doubled in the past year along with stocks over the past two years. Some stocks are up as much as 300, 400, 500% or more from the March, 2009 bottom to today. Normal markets do not double in one or two years. One only need to look at the massive amount of stimulus thrown at the markets via the Federal Reserve to see where the bubbles lie.
Where will everything go from here. A guess is a good as anyone can make right now, but if Ben Bernanke is serious about ending QE2 on schedule in June, one can probably side with deflation over the short term, a long-overdue market correction, and crashing interest rates.
Of course, the Fed can't allow interest rates to rise, since that would bankrupt the US government, so their only option is to reign things in, allow the stock market to correct and hope it doesn't crash as money will flow into medium term bonds. The speculative plays in commodities will cease to exist and the dollar will bounce.
That's a best guess scenario, until the next financial crisis, caused by either the Fed, the banks or the government, occurs. And one will occur, because one always does. Heck, it's been almost three years since the last one, so we're probably overdue.
In the long, long run, it's a depression, plain and simple. The Fed cannot continue printing money at a breakneck pace, nor can the government borrow at ridiculous speed, especially when the two biggest buyers of our debt (after the Federal Reserve, via the PDs and POMO), Japan and China, have their own issues and are not all that sound, economically-speaking.
In a world so tangled and cross-reliant, there are no safe havens, only places that will do better than others. Sure, the good, old USA will likely outperform Greece and Ireland, but Germany appears to be the only sane economy in the world, followed maybe by Brazil or India.
Dow 12,807.51, +0.15 (0.00%)
NASDAQ 2,841.62, -20.22 (0.71%)
S&P 500 1,356.62, -4.60 (0.34%)
NYSE Composite 8,584.68, -64.93 (0.75%)
Declining issues took the measure of advancers for the second straight day, 4471-2090, and if this kind of lopsided A/D line continues another day, we'll have no problem calling it a trend. On the NASDAQ, there were 60 new highs and 39 new lows, closing in on equilibrium. At the NYSE, 141 new highs and 22 new lows were recorded. And, surprise, surprise, volume was actually solid today; not a very positive sign for markets.
NASDAQ Volume 2,225,012,000
NYSE Volume 4,968,288,500
The commodity trade seems to e blowing up all over the place. WTI crude futures fell $2.47, to $111.05, when traders were shocked to find that there was actually a glut of oil sloshing around waiting to be turned into useful products, like gas, plastics, etc. The world has been led to believe that there's no more oil out there, that the political disruptions in the Middle East will cause production declines, when nothing is further from the truth. The oil wells and fields will keep on producing through revolution or peacetime, money is money, everywhere in the world, after all. There is simply a greedy cartel of nations and companies that like the price in the stratosphere and people need to drive their cars, run their engines, so it goes.
Gold was squelched a bit again, down $8.50, to $1537.10 at the moment, but that was nothing compared to the raid on silver, which is currently down $2.27, to $41.66. Remember, silver was almost $50 per ounce last week. A line has been drawn in the sand by the central banks and, more importantly, the silver shorts at JP Morgan and HSBC, who have won this battle, though the war carries on apace. Silver is eventually going to $150 on the open market and there's nothing they can do about it, long term. All they have is their paper market in the SLV and PSLV EFTs and they will eventually break down, when all participants require physical metal and they won't have enough.
That's where we stand today, on the precipice of failure of fiat money, for what it's worth.
On the absurdity scale, probably irrational, or maybe unbelievable.
That's exactly where US markets are now and for the foreseeable future - or until about the middle of June. Nothing makes sense on the surface, but there are correlations. Below the surface are machinations of big money players, central banks, the Too Big To Fail banks here in the US and Europe and whatever whacky game they're playing in the two biggest Eastern economies - China and Japan.
Consider that the dollar index spent the overnight gaining, fell sharply during the morning in the US, spent the next two hours rising, and ended the day with two hours of flatness, resulting in a final prinat at 4:00 pm EDT of 73.095, a paltry gain of 0.051, hardly a blip on anyone's radar.
Now, the Dow did follow along at the end, though it made all of its gains, back to a small print higher for the day, in the final hour of trading, bouncing back from a 50-point loss.
Meanwhile, silver had its worst one-day decline since the Hunt Brothers got wiped out in 1980. Sure, silver was overvalued on a very short-term basis, but the meaning of the massive, manipulated crash was to get the price back down to where JP Morgan and the rest of the shorts wouldn't be losing theirs. The attacks since Sunday night on the paper silver market, in conjunction with margin hikes by the COMEX, have had the desired effect. Silver is down, the US dollar will live for another day, week, a few months, maybe even until the presidential election in 2012.
Oil finally had its comeuppance, for a day, but if anything is a bubble, it is not silver, which has been suppressed for decades, or gold, which has broken out of the stranglehold of the big banks, but oil and stocks. Crude oil has doubled in the past year along with stocks over the past two years. Some stocks are up as much as 300, 400, 500% or more from the March, 2009 bottom to today. Normal markets do not double in one or two years. One only need to look at the massive amount of stimulus thrown at the markets via the Federal Reserve to see where the bubbles lie.
Where will everything go from here. A guess is a good as anyone can make right now, but if Ben Bernanke is serious about ending QE2 on schedule in June, one can probably side with deflation over the short term, a long-overdue market correction, and crashing interest rates.
Of course, the Fed can't allow interest rates to rise, since that would bankrupt the US government, so their only option is to reign things in, allow the stock market to correct and hope it doesn't crash as money will flow into medium term bonds. The speculative plays in commodities will cease to exist and the dollar will bounce.
That's a best guess scenario, until the next financial crisis, caused by either the Fed, the banks or the government, occurs. And one will occur, because one always does. Heck, it's been almost three years since the last one, so we're probably overdue.
In the long, long run, it's a depression, plain and simple. The Fed cannot continue printing money at a breakneck pace, nor can the government borrow at ridiculous speed, especially when the two biggest buyers of our debt (after the Federal Reserve, via the PDs and POMO), Japan and China, have their own issues and are not all that sound, economically-speaking.
In a world so tangled and cross-reliant, there are no safe havens, only places that will do better than others. Sure, the good, old USA will likely outperform Greece and Ireland, but Germany appears to be the only sane economy in the world, followed maybe by Brazil or India.
Dow 12,807.51, +0.15 (0.00%)
NASDAQ 2,841.62, -20.22 (0.71%)
S&P 500 1,356.62, -4.60 (0.34%)
NYSE Composite 8,584.68, -64.93 (0.75%)
Declining issues took the measure of advancers for the second straight day, 4471-2090, and if this kind of lopsided A/D line continues another day, we'll have no problem calling it a trend. On the NASDAQ, there were 60 new highs and 39 new lows, closing in on equilibrium. At the NYSE, 141 new highs and 22 new lows were recorded. And, surprise, surprise, volume was actually solid today; not a very positive sign for markets.
NASDAQ Volume 2,225,012,000
NYSE Volume 4,968,288,500
The commodity trade seems to e blowing up all over the place. WTI crude futures fell $2.47, to $111.05, when traders were shocked to find that there was actually a glut of oil sloshing around waiting to be turned into useful products, like gas, plastics, etc. The world has been led to believe that there's no more oil out there, that the political disruptions in the Middle East will cause production declines, when nothing is further from the truth. The oil wells and fields will keep on producing through revolution or peacetime, money is money, everywhere in the world, after all. There is simply a greedy cartel of nations and companies that like the price in the stratosphere and people need to drive their cars, run their engines, so it goes.
Gold was squelched a bit again, down $8.50, to $1537.10 at the moment, but that was nothing compared to the raid on silver, which is currently down $2.27, to $41.66. Remember, silver was almost $50 per ounce last week. A line has been drawn in the sand by the central banks and, more importantly, the silver shorts at JP Morgan and HSBC, who have won this battle, though the war carries on apace. Silver is eventually going to $150 on the open market and there's nothing they can do about it, long term. All they have is their paper market in the SLV and PSLV EFTs and they will eventually break down, when all participants require physical metal and they won't have enough.
That's where we stand today, on the precipice of failure of fiat money, for what it's worth.
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