Gold Daily And Silver Weekly Charts - The Money Matrix - Sic Transit Gloria Mundi

As a reminder, today was the silver option expiration on the Comex.

The EU Summit meeting is on Thursday and Friday of this week, 28-29 June.

Next Wednesday is the US 4th of July holiday.  I would expect many punters would like to be leaving early this week if they can.

This is also the last week of the second quarter.

The US Supreme Court is expected to rule on Obamacare on Thursday,

SP 500 and NDX Futures Daily Charts - Limbo European Style

The market is holding its breath waiting to see what happens in Europe.

The European Summit meeting is June 28-29, which may cause some cross currents into the weekend.

This week is also the end of the second quarter. 

The US Supreme Court is also expected to overturn a portion of Obamacare on Thursday. That may produce a brief but sellable rally ahead of the EU and the weekend. Very hard

Back Again to Money - the Banking System and Money Creation - A Forecast of Sorts

Money in the modern fiat sense originates from a number of sources.  Among these is the conversion of credit potential into money by the expansion of debt.  For the sake of simplicity I simply refer to this process as 'credit.'

This does not mean that 'credit' is money, not in the least. Credit is a source of money, and amongst the most vital in a highly geared fractional reserve banking

Gold Daily and Silver Weekly Charts - Big Bounce on 'Flight to Safety'

Gold and silver 'popped' today despite the higher dollar and risk off trade. It happened shortly after I posted the NAV premiums chart, having seen some odd action on the tape, and watching the action closely into the option expiration tomorrow in silver. It is also expiration for copper.

The metals often act oddly around their Comex Option Expirations, depending on a number of factors.  If

SP 500 and NDX Futures Daily Charts - Risk Off on Euro Summit Concerns

It was a 'risk off' day as stocks were sold and investors moved into safer plays.

This is the end of quarter week, so the tape may begin to take a coat of paint in a day or so, barring more storms from the continent.

Funds tend to sell their losers first, then pump up their holdings to mark them as winners. So watch out for the old 'one-two.'

Interesting that gold and silver went

NAV Premiums of Certain Precious Metal Trusts and Funds - Silver Undervalued

The premiums of some of the more popular Funds are back to 'normal' levels, but certainly not overly enthusiastic.

And we see a significant divergence between the metals and stocks today, suggesting perhaps that the selling in the metals had been overdone. Stocks are sharply lower, but the metals are stubbornly positive. And yet the US dollar is higher as well. A flight to safety? It looks

Michael J. Burry's Commencement Address at UCLA - Credibility Trap and the Predator State

Burry is describing the credibility trap that followed in the aftermath of the financial fraud that gripped the developed world through the Anglo-American banking cartel, perhaps without realizing it in those terms. This is why there is no honest discussion of what has been happening.

The financial crisis is not over. The bank bailouts and subsidies are as much a part of the vast financial

High Anxieties: The Mathematics of Chaos

"The hyper-rich are facing something worse than death: becoming poor. Do you think they will go quietly? I think they will do whatever it takes and sell it to us in the name of 'saving the system.'"

David Malone, Debt Generation
This documentary was started in 2007 by David Malone and Mark Tanner on commission from the BBC. David had finally persuaded the network that a financial collapse

The Loophole That Placed MF Global Customers At Risk Was Still Being Used

Apparently the 'loophole' that allowed MF Global to use customer assets for their own purposes and not set aside sufficient funds to cover them is still in place and still being used by some brokers.

The CFTC has sent a letter this month to all futures brokers telling them to stop using this loophole, and intends to close it through additional formal actions.

Change occurs, but slowly.

NY

Bill Moyers With Matt Taibbi and Yves Smith on the Banks - The Psychopathy of Wall Street

"Too many people hold the idea that psychopaths are essentially killers or convicts.

The general public hasn't been educated to see beyond the social stereotypes to understand that psychopaths can be entrepreneurs, politicians, CEOs and other successful individuals who may never see the inside of a prison."

Dr. Robert Hare





Source

Gold Daily and Silver Weekly Charts - Ending a Week of Shenanigans

Well, we can say goodby to this week, and good riddance to what proved to be a rough week for the metals bulls and miner mavens, except for the good news that Harvey Organ's illness was not life threatening and he will be fine it appears.

As you may recall, I warned about a 'hit' on the metals for FOMC meeting Tues-Wed. But I expected there to be a rebound and then another hit next week for

SP 500 and NDX Futures Daily Charts - Russell Rebalancing Today - End of Quarter Next Week

This was a rough week for trading as Benny did not please, but only tease.

The bank downgrades spooked shares but that may have been overblown. I think we saw selling this week tied into some technicals, including the Russell rebalancing, and the clearing of the decks for the end of quarter tape painting exercise next week, if nothing more blows up in Europe.

Next Tuesday 26 June Is Silver July Options Expiration - Shenanigans Reminder

Perhaps the reminder is a bit late, and the shenanigans have already occurred.

Although both gold and silver were hit hard around the FOMC meeting announcement, silver has been hit a bit harder.

Most curiously in yesterday's big down day the overall open interest EXPANDED by about 6,000 contract, mostly in the outer months of Sept - Dec. My friend Dave brought this to our attention this

Some Additional Questions For Jamie Dimon, Empereur de la République

“When a government is dependent upon bankers for money they, and not the leaders of the government, control the situation, since the hand that gives is superior to the hand that takes."

Napoleon Bonaparte
Interesting questions, but unlikely to come up at Mr. Dimon's next team building session with the Congress. They forgot to ask about this area while they were fawning all over the man, asking

Gold Daily and Silver Weekly Charts - Goldman Says 'Sell' And So They Do

Stocks were shaky but unchanged this morning, when Goldman came out and issued a 'sell' on the SP 500.

This shook the markets, but what really started them sliding were rumours that spread across the financial news channels and trading desks that Moodys would downgrade 17 global banks tonight, with a three level downgrade on Morgan Stanley.

Now whether this was true or not, the selling

SP 500 and NDX Futures Daily Charts - Goldman Signals a Sell Off

The economic numbers came in a bit shakey this morning, but stocks were holding in as the metals were hit.

Interestingly enough the financial short ETF FAZ was running negative while the broader short ETFs were showing gains.

Goldman shook the markets with a 'sell' on the SP today, and then rumours were abounding of a big downgrade of the banks by Moody's tonight, including a specific

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Stocks and commodities started selling off hard today on rumours that Moody's would be downgrading 17 banks tonight, including a triple downgrade on Morgan Stanley.

Let's see if this really happens as the trading desks said. I found it interesting that just before the rumour came out, the financials were rallying and FAZ, the triple bank short, was running higher, contra market.

How Wall Street Financial Companies Stole Billions From Main Street

Funny how these stories of widespread and systematic financial corruption are so undercovered by the main stream media. Maybe it is because 'truth is a dagger pointed at their heart, which is their pocketbook.'

This is a long piece of investigative journalism, but well worth reading.

It is too bad that the Banks had their major nemesis, Eliot Spitzer, taken out by the Feds under Bush II. And

Gold Daily and Silver Weekly Charts - More Wiggle Waggle

The Fed did what was expected, and the metals were hit going into this FOMC day, as expected.

Boring. Don't let these jokers muscle you out of your positions with their intraday shenanigans.

Let's see how the real trend develops.

I am long bullion and short stocks.

SP 500 and NDX Futures Daily Charts - Much Ado About Bernanke

Proctor and Gamble cast a pall over the real economy stocks as they lowered forecasts based on a weak consumer.

The wiseguys had some fun muscling prices after the Fed did the obvious, extending Operation Twist, and nothing else.

MF Global Customers "Get the Chance" To Auction Off Hopes For the Full Return of Stolen Funds

Great news for customers who had their money stolen by Wall Street!

No need to worry about its return, now they can sell their claims at a discount to -- Wall Street!

Perhaps we can get rid of the FDIC and cumbersome banking regulation and let people auction off their looted savings deposits and CD's when the Bankers lose their money by gambling on derivatives.

And as for education, well,

Gold Daily and Silver Weekly Charts - Pre-FOMC Action

Please notice that I have never attempted yet to put one of the arcing lines of support and resistance yet this year.

When I do, it will be because the chart has said something decisive. So far we are in what Hugo Salinas-Price calls the 'wiggle waggle.'

There was an obvious divergence from the usual pattern in stocks and gold today, most likely due to tomorrow's FOMC meeting.

SP 500 and NDX Futures Daily Charts

FOMC tomorrow.

Europe stills looms.

SP 500 September Futures Daily Chart Closeup

Today's action added some refinement to the daily SP 500 futures chart.

How this formation resolves, up or down, may depend on what happens in the next few days with regard to Europe and the Fed as you might expect.

The Secret State and the Tyranny of the Faceless and the Lifeless

“A nation can survive its fools, and even the ambitious. But it cannot survive treason from within. An enemy at the gates is less formidable, for he is known and carries his banner openly. But the traitor moves amongst those within the gate freely, his sly whispers rustling through all the alleys, heard in the very halls of government itself.

For the traitor appears not a traitor; he speaks in

A Closer Look at the SP 500 September Futures Daily Chart

I wonder if Benny will give the market what it needs on Wednesday.

They generally like to hit the metals on an FOMC meeting day.

Gold Daily and Silver Weekly Charts - Band-Aids and Butterfly Kisses

Nothing has been resolved in the international monetary and sovereign debt crisis.

This is all band-aids and butterfly kisses, soothing to little children, but nothing on the order of the change and reform that will be required to bring stability and growth back to the western economies, including the UK and the US.

The Banks must be restrained, and the financial system reformed, with balance

SP 500 and NDX Futures Daily Charts - Whistling Past the Parthenon

The market rallied last night by the 'win' of the 'pro-bailout' party. It looks as though they *might* be able to form a coalition with the center-socialist party at least on the assumption that the bailout can be renegotiated.

So the market came in ready for a rally that quickly evaporated, although stocks were able to finish unchanged.

The key news today is that NYSE volume was only about

Update on the Greek Political Situation

The Greek elections are of keen interest to many who do not normally follow their politics. And judging from questions I have received, not everyone in North America understands the mechanics of parliamentary government.

This is the best update and description of the process which I can find.

I cannot speak to accuracy of the PASOK party and the terms of their willingness to join a coalition

MF Global: Follow the Customer Money - The Economics of Demagogues

One of the key facts, which ought to have been apparent in the first week or so after its collapse given the tracking mechanism of wire transfers, is 'who got the customer money' and 'who received a preferential return of funds in the last weeks when the brokerage was failing?'

That we still do not know who 'got the money,' although recent admissions show that JPM did in fact receive about $768

Greek Election Final Results - A House Divided

Click here for igraphics.gr

The pro-austerity party did not receive enough votes to promote a stable government without making significant coalition arrangments with one or more of the other parties. And it appears that none of the others will join with them on their austerity platform.

So as we suggested, nothing has been resolved for now.

The Guardian UK
"Syriza's Alexis Tsipras has

In memory of Journalist Carl von Ossietzky

"We cannot look to the conscience of the world when our own conscience is asleep."

Carl von Ossietzky


"Silence in the face of evil is itself evil: God will not hold us guiltless. Not to speak is to speak. Not to act is to act."

Dietrich Bonhoeffer


"Only one who spent the years following the First World War in Germany can fully understand how hard a battle it was that a man like Ossietzky

Bill Moyers and James K. Galbraith Talk About the Financial Crisis and John Kenneth Galbraith

Gold Daily and Silver Weekly Charts - Market Manipulation and Special Message from Jim Sinclair

A Few Questions, One Answer
By Ted Butler
June 15, 2012

Please read this article carefully because I’m disclosing for the first time that the U.S. government has given JPMorgan the green light to manipulate the silver market. This fact explains the shenanigans in the silver market. It answers all the questions and exposes this tawdry affair for all to see.

The scandal recently became more

SP 500 and NDX Futures Daily Charts - Muscling the Shorts On the Quad Witch

The futures charts have now been rolled over to the September front month.

Big things are expected to happen in the world economy and quickly. It will be most likely that nothing really decisive happens to change this debt crisis, but let's keep an open mind and see what the Greeks do, and what the central banks do in response.

Long bullion and short stocks.

See you Sunday evening.

The Senate's Embarrassing Performance in the Dimon Inquiry

Apparently I was not the only one who could not bear to watch this. As I said, it was iffy going, but Jim DeMint pushed me right over the edge.


Senators Grovel, Embarrass Themselves at Dimon Hearing - Rolling Stone


And here is Jon Stewart's take:

The Daily Show
Get More: Daily Show Full Episodes,Political Humor & Satire Blog,The Daily Show on Facebook

Former Goldman Sachs Director Rajat Gupta Found Guilty on Four Counts of Insider Trading

Jury deliberated only two days, finding Gupta guilty on four counts of insider trading, and innocent of two counts.

This was clearly a case of failing to maintain GPS coordinates when burying the bodies for your masters, and failing to provide sufficient campaign donations to the plutocracy.

The pampered princes have thrown another one of their Immortals to the wolves.

So Lloyd has given up

Gold Daily and Silver Weekly Charts - Rough Waters Ahead

"All this wiggle-waggle of the gold price below or around $1600 is simply the result of official efforts to delay the appearance of $2,000+ gold.

That is the big event ahead, whose appearance will have deep psychological impact on markets, because the establishment of $2000+ gold will reinforce the idea that gold has still much higher to go."

Hugo Salinas-Price
Central Banks Stand Ready to

SP 500 and NDX Futures Daily Charts - The Old Whipsaw Ahead of Quad Witching Expiration

"Those that have so much power over others as to be able to oppress them have seldom so much over themselves as not to oppress."

Matthew Henry

There was some profound whipsawing in the stock futures market today as rumours were spread liberally by trading desks attempting to exit positions and square their books ahead of tomorrow's big option expiration and the exogenous events of the next

Blaming the Victim and Other Biases and Their Use by the Predator Class To Subvert the Unwary

It is an occasional human fault to get pulled into the habit of 'blaming the victim.'

Most people do not do it regularly, except in the case of some uninformed prejudice or in response to misinformation.

But some people seem to do it more often and sometimes habitually. Why is that?

As we might imagine, nothing can make a certain type of person feel better about themselves than attributing

Allen Stanford Sentenced to 110 Ten Years in Prison For Ponzi Scheme

Breaking news...

High living Texas banker Sir Allen Stanford, often referred to as 'the other Madoff,' was sentenced today to 110 years in prison for the Ponzi scheme he operated by selling fraudulent certificates of deposit issued by his Antigua-based Stanford International Bank Ltd., and sold in the U.S. by his Houston-based securities firm, Stanford Group Co.

The US Justice Department had

Simon Johnson: The Institutional Flaw At the Heart of the Federal Reserve

This is a long 'thought piece' by Simon Johnson, an eminent US economist and professor at the MIT Sloan School of Management.

It exposes the inherent conflicts of interest at the New York Fed, the history behind that structural flaw, and the problems it creates in a time of high powered money and financialization, with the Fed assuming even more regulatory powers from a craven Congress.

This

Gold Daily and Silver Weekly Charts - The Rolling Global Financial Crisis Intensifies

"Let me make it clear straight away – the lies, corruption, cowardice and greed of Spanish bankers and government officials is nothing special. What is happening in Spain now, reminds me of Northern Rock in the UK, Hypo in Germany and CountryWide in the US. So please do not think that I dislike Spain or of the ordinary people of Spain. The people I detest in Spain are the same people I detest

SP 500 and NDX Futures Daily Charts - Edging Fitfully Towards Option Expiration

If you listened to the financial news today and the comments about Jamie Dimon's appearance before the Senate you would think that the financial crisis and bailouts had never occurred.

And that is what they call 'moral hazard' and why it will happen again. All of it.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

A decided lack of euphoria, in keeping with a Greco-Spanish chill over all the markets.

Acemoglu and Robinson: Why Nations Fail

In a generally deferential and ineffective Congressional spectacle, some say minuet and I think kabuki dance, Jim DeMint's 'questioning' of Jamie Dimon, who responded to most serious questions with poker faced whoppers, today pushed me over the edge, and so putting the internet feed on mute, I thought I would take a moment to bring the study Why Nation's Fail by Acemoglu and Robinson to your

Charles Ferguson: Predator Nation, Global Predator Class

"Over the last thirty years, the United States has been taken over by an amoral financial oligarchy, and the American dream of opportunity, education, and upward mobility is now largely confined to the top few percent of the population. Federal policy is increasingly dictated by the wealthy, by the financial sector, and by powerful (though sometimes badly mismanaged) industries such as

Gold Daily and Silver Weekly Charts - Metals Move Higher With Stocks

There is a 'quad witch' in stocks this Friday so be prepared for some extra volatility.

Gold is approaching key intermediate downtrending resistance again.

SP 500 and NDX Futures Daily Reports - Muscling the Shorts Ahead of Quad Witch

As a reminder this Friday will be a 'quad witch' on the stock indices.

Also the Greek elections will be held this weekend. They may determine the stance of the Greek people towards the Euro bailout and austerity offers.

This could cause quite a bit of 'technical trade' and sheer muscling of price to meet the big players agendas.

This is the natural result of markets dominated by hot money

Chris Whalen: Will Jamie Dimon Tell the Truth, Because He Hasn't Done So Yet

"Of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of plutocracy."

John Pierpont Morgan


Oh you must mean the vaporized money...
Chris Whalen makes some interesting observations and cuts to the heart of the matter, although he sometimes falls into the morality of the income statement.

The reactions of the CNBC spokesmodels and Andrew

Gold Daily and Silver Weekly Charts - Metals Rise in a Flight to Safety - Refuse to Lose

“Yet while the rest of the populace was suffering, the rich just got richer. In 2009 and 2010, years in which millions were unable to find work, the top one percent reaped 93 percent of the 'recovery' income, and corporations are making more than they ever did. And the Republicans can still propose even further cuts in the taxes of 'job creators' whose only job creation has been for their own

SP 500 and NDX Futures Daily Charts - Rough Day for the Bulls, Tyranny of Money

"There have been tyrannical gods, and there is the God who makes us free.

Tyrant gods, nowadays, do not, as a rule, assume the names of gods. They prefer pseudonyms. But their tyranny remains the same."

Henri de Lubac

There was euphoria to the upside in the overnight futures as the Spain bailout cheered the markets.

The reality of the situation and the impending Greek elections chilled the

Caption Contest

Playing with the big buoys.

Ben 'Big Ones' Bernanke

The Fed has a printing press, but it takes a pair of these to use it.

Ben is always ready for the next tsunami.

Thanks for the loan Jamie!


What do you think?

Gold Daily and Silver Weekly Charts - Monkey Shines

“What happened yesterday in the gold market was very interesting. One full hour before Bernanke's testimony, the bullion banks started selling. Over the next 4 hours, the bullion banks sold the equivalent of 515 metric tons of paper gold. This was in just 4 hours, and again, the selling started one hour before Bernanke’s testimony...

The real question here is, how could an entity begin

SP 500 and NDX Futures Daily Charts - Looking For Mr. Goodbar

Spain is asking the ECB for 'help' tomorrow. The anticipation there help fuel some of the speculative games today.

Is this like asking for an invitation to one of Signor Berlusconi's bunga bunga parties?  I think it would be of the foremost importance to discuss all the specifics in advance.

So far the IMF and ECB are not helping resolve the situation.  One has to wonder what they are thinking

Chris Hedges: Resistance and Faith, Faith and Unbelief - Prague Spring 1968

“Each time a man stands for an ideal, or acts to improve the lot of others, or strikes out against injustice, he sends a tiny ripple of hope, and crossing each other from a million different centers of energy and daring, those ripples build a current which can sweep down the mightiest walls of oppression and resistance.”

Robert Francis Kennedy


"Even a purely moral act that has no hope of any

Gold Daily and Silver Weekly Chart - Providing Air Cover for Ben

Obvious, heavy-handed, and in no further need of comment.

SP 500 and NDX Futures Daily Charts

"Before now, I had never really understood how the 1930s could happen. Now I do. All one needs are fragile economies, a rigid monetary regime, intense debate over what must be done, widespread belief that suffering (for others - Jesse) is good, myopic politicians, an inability to co-operate and failure to stay ahead of events."

Martin Wolf, 5 June 2012
The fingers of the Anglo-Americans are

Gold Daily and Silver Weekly Charts - The Fear

Gold was threatening to break out of the intermediate downtrend today but was smacked down rather hard just after the Fed beige book release.

The meme from the spokesmodels was that the economy is doing well enough so that no QE is needed for recovery, and this was implied by the Fed's observations.

I think there is fear and foreboding in Zombieland.

SP 500 and NDX Futures Daily Charts - Hogarth's The Cockpit

Today seemed a more 'technical trade' than anything else in equities, which were largely unscathed by the Fed Beige books as the demimonde informed us that the US can have a recovery without any more QE, making stocks cheap and gold dear.

Give it a week or a day.

The American Political Process In One Picture

"Money! It is money! Money! Money! Not ideas, nor principles, but money that reigns supreme in American politics."

Sen. Robert C. Byrd, March 20, 1997

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

I have my eye on 1320 on the SP 500 futures as a key resistance.

Gold is attempting to break out here.

MF Global Hid Risk To Avoid Capital Requirements While FINRA Regulators Looked On

One of the common elements in most of the great financial debacles seems, at heart, to involve accounting fraud that is tolerated and excused by all those entrusted with the safeguarding of the public interest and the innocent.

What characterizes the modern financial system, and its vast influence on the fabric of society, the political process, and the dialogues of public policy is the power

Gold Daily and Silver Weekly Charts - Stayin' Alive

The markets are waiting for the Greek elections, a resolution of some sort to the European situation, and the Fed.





"All I wanted was just what everybody else wants, you know, to be loved.

Every man I knew went to bed with Gilda-- and woke up with me."

Rita Hayworth


As a side note, this brought back some fond memories for me. SwissAir would sometimes feature an old movie like 'Singing

SP 500 and NDX Futures Daily Charts

Marking time more than anything else.

I recovered my computer platform from a catastrophic hardware failure.

Just one of those things.

Puzzled About QE? Watch the Adjusted Monetary Base

Quantitative easing is generally reflected in the expansion of the Monetary Base of the Federal Reserve Bank.

There could be instances wherein monetary expansion in the nature of QE could be done 'off balance sheet' in the manner of swaps, etc.

But in general, unless the monetary base starts contracting, not just stable, then QE is still in place. It can change to a form of 'qualitative

Are Stocks In a New Bear Market?

Maybe they will be, but the charts do not show that yet.

I prefer to use the Russell 2000 when determining such things, because the other indices are too narrow and subject to single sector vagaries and manipulation. This is especially true of the Dow Industrials and the NDX.

So far what we have seen is about a 50% retracement of the most recent rally leg.

One might also make the case that

Gold Daily and Silver Weekly Charts - Egan Jones Downgrades the UK

Intraday commentary here.

Egan Jones downgrades the sovereign debt of the UK after the bell to AA-.

SP 500 and NDX Futures Daily Charts - Quiet Day Despite Early Volatility

The light volumes made the Spoos amenable to the old push and shove.

Markets are still very edgy, with today as perhaps just a short covering pause and some profit taking on the bear side.

Gold Is At Imporant Intermediate Term Resistance - Long Term GATA Has It Right

After the spectacular rally of last Friday it is natural for gold to pause and consolidate here.

However, I wanted to make sure you could see the position of the gold price with regard to the intermediate trend.

This is the key resistance which I referred to last week, clearly visible in the chart below.

The hedge funds were leaning very hard on the short side as we had shown in some of the

Chris Hedges: Days of Destruction, Days of Revolt

The video starts after the introductions.

"Unfettered, unregulated capitalism...turns everything into a commodity, human beings become commodities, the natural world becomes a commodity, that it exploits until exhaustion or collapse. In essence it cannibalizes itself, and this is the process that we are undergoing."

Chris Hedges
The essence of statism, of the far left or the far right, is

Gold Daily and Silver Weekly Charts - Did We See A Bottom In Gold Today?

"Quite unexpectedly, except perhaps among a handful of long-time gold advocates, gold is quietly and gradually moving back to its centerpiece role in international reserves. Stretched and threatened financially, nation states have begun accumulating gold for the same reason private individuals do -- as portfolio insurance to cover a wide assortment of economic uncertainties.

What's more, this

SP 500 and NDX Futures Daily Charts - Something Wicked This Way Comes

"The yield on the 10-yr Treasury is at a record all-time low and the yield on the 30-yr Treasury - the Big Daddy - is below it's lowest point during the Lehman crisis. That's not just warning signals flashing, that's the equivalent of financial nuclear air raid sirens going off.

What this means is that the liquidity is being sucked out of the global financial engine and is going into

Dude, Where's My Deflation? Yes the Fed Has Lowered Rates and Grown Money Supply But...

My email box pretty much exploded today as the metals rally and divergence from stocks woke up the audience. And the action in my own accounts tended to be diverting, and not unhappily so. Sorry if I have been slow in getting back to you all, and in answering your questions.

Let's take a look at the monetary scorecard and a few ancillary measures to see how Ben and His Merry Pranksters are

Joe Stiglitz On the Price of Widening Inequality - The Tsar Nicholas II Syndrome

"Is there a greater tragedy imaginable than that, in our endeavour consciously to shape our future in accordance with high ideals, we should in fact unwittingly produce the very opposite of what we have been striving for?"

Friedrich Hayek
I don't know if I would call that a great tragedy, or a greater irony. It most likely depends on the spirit with which one undertakes that endeavour to shape

Gold, Silver, and the May Jobs Report

"Through a set of economic policies designed to bail out and subsidize failed and often fraudulent corporate enterprises, while actively promoting a false sense of confidence to support those policies, the public has become exposed, by those very people entrusted to protect them, to dangerously high levels of hidden counterparty risks.

The cautionary functions of the media, the political

Simon Johnson: Jamie Dimon and the Failure of the Nation

No matter how you wish to frame it, the Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustained growth and recovery.

Baseline Scenario
Jamie Dimon And The Fall Of Nations
By Simon Johnson
May 31, 2012

“Why Nations Fail: The Origins of Power, Prosperity, and Poverty,” by Daron Acemoglu and James Robinson, is a

Gold Daily and Silver Weekly Charts - Brownian Motion

Here is a summary of what the spokesmodels said about precious metals today.

Yada-yada. Yada yada yada.
Non-Farm Payrolls report tomorrow will dominate the short term action perhaps depending on how the number comes in, but the real driver remains the sovereign debt situation with eyes on Greece and Spain in pariticular.

The Greek election mid month may provide some indication of their

SP 500 and NDX Futures Daily Charts - Weak GDP, But Markets Watch Payrolls and Greece

Watch for the Non-Farm payrolls report, and the Greek situation. Their elections are mid-month and could be a significant market driver.

Lauren Lyster Interviews CBO Whistleblower Lan Pham

From the February 2, 2012 Wall Street Journal story on Lan Pham's firing:

"I was repeatedly pressured by the CBO Assistant Director, Deborah Lucas, in charge of the Financial Analysis Division to not write nor discuss issues in the banking sector and mortgage markets that might suggest weakness in these sectors and their consequences on the economy and households."

The CBO's 2010 termination

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Bullion prices are bouncing around a bit today with stocks ahead of the Non-Farm Payrolls Report.

Needless to say, the premiums are a bit 'thin' especially on the Spicer family funds.

Sheila Bair on Tightening the Volcker Rule and the JPM 'Hedging' Fiasco

Sheila Bair will be sorely missed as one of the few coherent and less-servile regulators. She was appointed to her position in 2006 by George W. Bush, so no credit to Obama. She was most likely a happy mistake because Bush II certainly was not long on regulatory effectiveness with Hank Paulson at the helm.

Obama's appointments to the financial and economic oversight positions in his

Gold Daily and Silver Weekly Charts - About Those Special Issue Bonds and Full Faith and Credit

I was expecting another 'hit' on the futures contracts around the May-June contract dates I have posted several times.

Perhaps the antics today will be all for now. Let's see what happens.

Someone said something unintentionally funny about the Social Security Trust Fund bonds and the reliability of the US government today that I ordinarily would ignore, but it may serve to illustrate a point.

SP 500 and NDX Futures Daily Charts - Waiting for Greece and the Fed

The economic picture in the States is not good. It is muddling along, but is hardly sustainable or robust.

But the great attention of the markets now is focused on the Greek elections in mid-June, and what the Fed will do in the next meeting which is a few days later.

Taibbi: The Epic Failure of the SEC

"The big thieves hang the little ones."
I cannot argue with what Matt Taibbi says here, having quoted others like Bill Black about the same situation in great detail.

But in fairness to the SEC, this is hardly the case of a single regulator falling into porn-surfing indolence while they wait for another turn through the Wall Street revolving door.

The SEC is just another branch of regulatory

James Koutoulas Says JP Morgan Is Still Hiding Large Amount of MF Global Customer Money

I do not agree with Rick Santelli's throwaway line in the beginning that there was probably no illegality involved in JPM's trades in London, and certainly not with regard to Facebook where it appears that there was blatantly selective leaking of undisclosed negative financial information ahead of the IPO. And the corollary suggestion that any investigations there are a waste of time.

The

Freedom in Europe Is Eroding From the Edges, Financed by the Banks

"Greece is not an exception. It is one of the main testing grounds for a new socio-economic model of potentially unlimited application: a depoliticised technocracy in which bankers and other experts are allowed to demolish democracy."

Slavoj Žižek


"Corruption is a tree, whose branches are of an immeasurable length: they spread everywhere; and the dew that drops from thence hath infected some

The Death of the Gold Bull May Be Greatly Exaggerated -- Miner / Bullion Ratio at an Extreme Low

There was an opinion making the rounds today from a chief strategist named Suttmeier that the gold bull market was over because the 50 day moving average has fallen below the 200 day moving average for gold, commonly called a 'death cross.'

Interestingly enough he calls for a trading range, and not a further significant decline in gold, but rather a 5% trading range 'for years.'

During the

Greek 'Aid' Is Really Enhanced Vendor Financing and Foreign Bank Bailouts

“They don’t want to kill us [the Greek people] but keep us down on our knees so we can keep paying them indefinitely.”

Eva Kyriadou
The similarity to the Icelandic situation is striking.  Greece must deal with the problem of decoupling from the Euro, but other than that the scenario seems fairly straightforward.

Greece needs to assert their independence, and have the will to make it 'stick.'

Gold Daily and Silver Weekly Charts - Gold Chart Shows About 10,000 Contracts Dumped in Quiet Market

I felt this bear raid coming on the tape, from the action I was seeing. I cannot express it better than that.

So I had sold my silver bullion trading position and trimmed back gold, adding a hedge in the first hour of trade.

The hit came around mid-day after the European close as you can see on the 5 minute June futures chart.

One does not drop 11,000 contracts in a ten minute period in what

SP 500 and NDX Futures Daily Charts - The Well Tempered Clavier

Geithner and Bernanke are playing a tune for us on the US equity futures markets, with the lead vocals coming from the SP 500 June contract.

Can you name that tune?

I do not think they can hit the high note without a serious bump of QE to sustain them. And Benny may provide it, if somewhat stealthily, mid month around the time of the Greek elections.


 

Barry Ritholtz Interview On the Financial Crisis from Capitalism Without Failure

Excellent interview as always by Barry, and an interesting list of suggested readings. His blog, The Big Picture, is among the best.

I would respectfully include ECONned by Yves Smith on the reading list. It adds a dimension of scholarship and detailed analysis found nowhere else.

Barry Ritholtz on the Crisis: Causes, Cures, Corptocracy, and Suggested Reading

When you get bit by a dog, you

Highly Resolve That These Dead Shall Not Have Died In Vain

"Change does not roll in on the wheels of inevitability, but comes through continuous struggle. And so we must straighten our backs and work for our freedom. A man can't ride you unless your back is bent."

Martin Luther King, Jr.


Judge of Nations, spare us yet,
Lest we forget—lest we forget.

Rudyard Kipling

Four score and seven years ago our fathers brought forth on this continent, a new

Bill Moyers & Company: Reckoning With Torture

"Some may argue that we would be more effective if we sanctioned torture or other expedient methods to obtain information from the enemy. They would be wrong. Beyond the basic fact that such actions are illegal, history shows that they also are frequently neither useful nor necessary."

David H. Petraeus, Commander, U.S. Central Command

“The bottom line is these techniques have hurt our image

Ted Butler Calls Out the CFTC On Silver Market Manipulation

Considering how patient and understated he has been for so long, and so often the voice of reasonableness, this latest piece from Ted Butler is a bit surprising in the directness and strength of his language.

Illegalities
By Ted Butler
May 25, 2012

The Commodity Futures Trading Commission (CFTC) has been negligent in failing to terminate the obvious manipulation ongoing in silver. Furthermore,

Gold Daily and Silver Weekly Charts - Fed Will Backstop a Run On the Exchange

The situation remains rather volatile and open to an exogenous event.

Gold has not yet broken its downtrend. We do have the option expiration under our belts at least and are entering a heavy delivery season.

I thought it was interesting that the US government has directed the Fed to backstop the Comex and ICE in the case of a liquidity event or a run on the exchange.

In that event be ready

SP 500 and NDX Futures Daily Charts - Tiptoeing Into the Long Holiday Weekend

Concerns about Greece and its potential impact on the global banking system continue to dominate the financial trade.

Some think that there will be some resolution this week because of the US holiday on Monday. That is possible.

If there is a positive resolution the equity markets will rally very hard. On the other hand if Greece withdraws from the euro, and perhaps even the EU altogether,

Max Keiser Interviews Teri Buhl On JP Morgan's Wells Notice

I found the description of the Wells Notice to be interesting.



Source

Teri Buhl's column discussing this and the implications.

US to Backstop the Anglo-American Derivatives Exchanges with Fed Dollars - 'Too Big To Fail'

It sounds like the principle of keeping AIG whole on its obligations so that it can pay off to the banks at 100 cents on the dollar. This should make Jamie feel a little better about his bad derivatives trades.

And Blythe should rest easy knowing that Benny has her back on those massive metals shorts.

Sounds like they even plan to have the Fed backstop the derivatives trade in London.

Heads

JPM Gave Risk Management Oversight To Museum Head Who Sat On AIG's Board

"Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses, and when, not if, they suffer losses so large that they would cause the bank to fail, they will be bailed out."

William K Black

This is JP Morgan, America's mightiest and unsinkable 'showcase bank,' run by its toughest and craftiest CEO, that holds the

No Justice: SEC Probes Lehman For Three Years, Recommends Nothing

Corruptio optimi pessima.
(The best things when corrupted become the worst.)

Aristotle, Nicomachean Ethics
Not even a wristslap.

Well at least the SEC released its report. The craven curs and hypocrites at the CFTC have been studying the criminal manipulation of the silver market for more than four years, and as of yet have not even had the decency to release their findings, and then proclaim

Gold Daily and Silver Weekly Charts - Quiet Option Expiration With a Little Gut Check

Precious metal holders were jerked around a little today on the option expiration. I would anticipate another hit tomorrow to test the hands holding in the money calls, which are converted to active futures contracts at the close.

All eyes are on Europe and the western central banks.

Gold needs to break the big downtrend to prove that the decline is over. Until then I would not feel

SP 500 and NDX Futures Daily Charts

Another nothing day, marking time. The traders want to see what happens in Europe, and what Ben and his pals will do in response.

Gold Daily and Silver Weekly Charts - V Bottom Ahead of Option Expiration?

Intraday commentary on important dates in the next two weeks here.

May 24
OG - June 2012 Gold American Options - Last Trade Date
OG - June 2012 Gold American Options - Settlement Date

May 29
QO - June 2012 COMEX miNY Gold - Last Trade Date
QO - June 2012 COMEX miNY Gold - Settlement Date
GC - May 2012 Gold - Last Trade Date
GC - May 2012 Gold - Settlement Date

May 31
GC - May 2012 Gold

SP 500 and NDX Futures Daily Charts - Intraday Reversal

Boys will be boys.

Fed's Kocherlakota: I Reject Your Reality and Substitute My Own

"'When I use a word,' Humpty Dumpty said, in rather a scornful tone, `it means just what I choose it to mean -- neither more nor less.'

`The question is,' said Alice, `whether you can make words mean so many different things.'

`The question is,' said Humpty Dumpty, `to be master -- that's all.'"

Lewis Carroll

I thought it was interesting that Narayan Kocherlakota, president of the

Key Comex Dates For Gold In the Next Two Weeks

Here are some key dates on the Comex for the Gold Futures and Options.

Tomorrow is the June Gold Options Last Trade and Settlement Date

Next week is the Last Trade and Settlement for the Gold futures contract.

This is historically a heavy physical delivery period for gold and silver.

I suspect that this latest price action is less about Europe and Greece, and more about Chicago and New York

William Black on JP Morgan and the Failure to Regulate Wall Street Fraud

"It is no exaggeration to say that since the 1980s, much of the global financial sector has become criminalised, creating an industry culture that tolerates or even encourages systematic fraud. The behaviour that caused the mortgage bubble and financial crisis of 2008 was a natural outcome and continuation of this pattern, rather than some kind of economic accident...And yet none of this conduct

Max Keiser Interviews Francine McKenna On JP Morgan and MF Global

"In this respect England exhibits the most remarkable phaenomenon in the universe in the contrast between the profligacy of its government and the probity of its citizens. And accordingly it is now exhibiting an example of the truth of the maxim that virtue & interest are inseparable.

It ends, as might have been expected, in the ruin of its people, but this ruin will fall heaviest, as it ought

PBS Frontline: MF Global's Six Billion Dollar Bet

PBS Frontline did an exceptionally good job putting this together.

Watch it if you can and pass it along.

By the way, Steve R. Meyers is the same person who formerly did the video analysis on commodities which we had here.


Source

Gold Daily and Silver Weekly Charts - Schlock and Awe

SP 500 and NDX Futures Daily Charts - More of the Same

Late day headline about Greece ready to leave Euro caused a light sell off in stocks which had been up much of the day.

Really, nothing of significance yet.

Gold Daily and Silver Weekly Charts - Is That Jamie's Ring You're Wearing?

More fruitless games in the metals today, and probably some needed consolidation.

SP 500 and NDX Futures Daily Charts - The Wages of Greed

"Men are qualified for civil liberty in exact proportion to their disposition to put moral chains upon their own appetites; in proportion as their love to justice is above their rapacity; in proportion as their soundness and sobriety of understanding is above their vanity and presumption; in proportion as they are more disposed to listen to the counsels of the wise and good, in preference to the

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

BBC Interview with Nassim Taleb on JPMorgan

"It is one of the serious evils of our present system of banking that it enables one class of society, and that by no means a numerous one, by its control over the currency to act injuriously upon the interests of all the others and to exercise more than its just proportion of influence in political affairs."

Andrew Jackson, Farewell Address

Rational people keep struggling with the 'why' of

CFTC Commissioner Bart Chilton On the Irony of JP Morgan's Trading Loss

"Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional income that leads to real bonuses and when (not if) they suffer losses so large that they would cause the bank to fail, they will be bailed out."

William K Black
When the next financial crisis occurs remember the things that Bart Chilton says in his op-ed piece below. Things like

Gold Daily and Silver Weekly Charts - Something Wicked This Way Comes

“Something has to be done because it’s totally out of control these days. I mean you can’t have bank runs like we’re seeing. The one thing the powers that be, the central banks and the governments, have tried to do is to avoid what I call a ‘Liquidation Event.’

Ever since we saw what happened when Lehman was liquidated, they realized we can’t go there. Fannie was taken over as well as AIG

SP 500 and NDX Futures Daily Charts - Facebook Face Plant

The Commencement Address That Won’t Be Given
By Robert Reich
Friday, May 18, 2012

Members of the Class of 2012,

As a former secretary of labor and current professor, I feel I owe it to you to tell you the truth about the pieces of parchment you’re picking up today.

You’re f*cked...

Read the rest here.
Facebook closed largely unchanged from the IPO price after an initial pop up to 42. On

Bill Moyers Interviews Simon Johnson on JP Morgan Chase and the Next Financial Crisis

“The signs that I see, the body language, the words, the op-eds, the testimony, the way these bankers are treated by certain congressional committees, it makes me feel very worried. I have a feeling in my stomach that is what I had in other countries, much poorer countries, countries that were headed into really difficult economic situations. When there’s a small group of people who got you into

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

Jim Rickards On JP Morgan's Trading (Gambling) Loss - The Hypocrisy of Plutocrats

JPMorgan, the nation's largest bank, receives an explicit federal subsidy (deposit insurance) and a much larger implicit federal subsidy. It's improper for the megabank to use these subsidies to speculate in derivatives. And yet it can do so with hardly any serious regulatory consequences.

Financial institutions such as JPMorgan love to buy derivatives because they are opaque, create fictional

Chris Powell Answers Doug Casey's Questions About Gold Manipulation

I had read Casey's piece, but quickly lost interest in it at the argument that the gold market is so big it cannot be manipulated by the poor weak central banks and their surrounding commercial banks who are practically bankrupt.

If someone is a value sophisticate in a segment of the market, but does not understand and have concern for the power of the Federal Reserve and its associated banks

Gold Daily and Silver Weekly Charts - Massive Short Covering Rally From Deeply Oversold

Facebook priced after the bell, 421 million shares @ $38 with a PE of 107 and a Price/Sales of 25.

This is "the largest internet IPO in history" (Ring Ring Ring).

It will start trading in the public markets, as opposed to dark pools and private deals, tomorrow after 11 am Eastern Time.  That will make share acquisition a bit problematic in Europe.

The wiseguys are geared up for a multiday

SP 500 and NDX Futures Daily Charts - Facebook Cometh - Last of the Dot Bombs?

Big down day in the US markets today as the trading desks flushed out their weaker positions and got ready to pump up Facebook tomorrow for what could work out to be the mother of pump and dump operations. I do not expect the fat lady to sing tomorrow, but I think she will start warming up for what could be remembered in a few years as the end of an era, a watershed event.

Let's see what

Devaluing the Dollar - Against What?

When people talk about devaluing the dollar, as opposed to reissuing it completely, the natural question is, against what? What would one devalue it against officially if you do not wish to reinstitute a formal gold standard, which is clearly the preference of the Western central bank.

One likely candidate might be the SDR issued as a new currency for global trade, and for the pricing of 

Net Asset Value Premiums Of Certain Precious Metal Trusts and Funds

A Quick Look At the Market Technicals: SP500, Gold, Silver, VIX

The gold and silver charts have not been updated for today's rally.

As is clear from the metals charts, gold and silver were DEEPLY oversold short term. So this *could* be a relief rally. The talking heads say it was because of the weak leading indicators this morning with overtones of QE3, but I think it is more likely that the momentum traders took it as low as it would go without hitting

Another Take on Inequality From Nick Hanauer and the Restoration Roundtable

I would add that the source of the payment for the consumption is a major factor.

If it comes from a growing median wage that permits consumption and savings by the broader public, then the virtuous cycle is engaged.

However, if the consumption comes from borrowing and credit expansion with the benefits flowing overseas or to the wealthy, there is no virtuous cycle, or the amelioration of

Corzine Syndrome: JPM's Stealth Prop Trading Unit Was Crafted for Risky Profit and Reported Directly To Jamie Dimon

I want to put a spike in all this spin around the CEO defense, that poor Jamie could not have possibly known what was going on in London because the company was so large, and he is such a busy man. Sarbanes-Oxley was designed to put a stop to that lame excuse touted out by defense lawyers and apologists in the media every time something like this happens.

The CIO operation was transformed

Gold Daily and Silver Weekly Charts - Facebook, Greece, and the Hollow Men

I am leaving a bit early this evening.

Facebook and Greece are dominating the market, and both in their own ways are contributing to the selling.

The wiseguys see Facebook coming out at around 36-38 and intend to run it up I think to the 60+ are and then dump it for a quick return. So they are raising cash and, gasp, selling even AAPL to do it.

Greece has the markets edgy for all the usual

SP 500 and NDX Futures Daily Charts - Facebook Cometh Tomorrow Night

Leaving a bit early today. Will catch up tomorrow.

Facebook will price after the bell tomorrow. Expectations are for about $36 per share or so.

There was some interesting hypocrisy on Capitol Hill this morning by the Republicans who are red-faced over the JPM antics, since they have been adamant about turning back regulations.

A friend sent this in to my email.  I did not see it, so I do

Hot Money Bets Backed By Taxpayers: Extreme Moral Hazard of 'Too Big To Fail' - Credibility Trap

The professor makes some excellent points about the real world of finance that bear some serious thought. He certainly left the Bloomberg spokesmodels yammering in search of a sound byte.

He misses a key point however. It is not that Jamie Dimon does not know, or even that he cannot know, about the risky speculation in his firm. It is that the system is so designed now that in the long run he

Goldman Data Admits to Naked Short Selling, Disclosing Client Positions, Abusive Legal Practices

“He should be someone we can work with, especially if he sees that cooperation results in resources, both data and funding, while resistance results in isolation.”

Goldman Sachs


"To be a sophisticate in the 21st century requires the ability to shut one's eyes and one's mind to anything that one does not want to see or think about. The more glaring that the contradiction between what is said

Eliot Spitzer on JPM and Bank Reform

“For all sad words of tongue and pen, The saddest are these, 'It might have been'.”

John Greenleaf Whittier
Flawed indeed.

Slate
Flawed Dimon
By Eliot Spitzer
May 14, 2012

What to do with Jamie Dimon? The CEO and Chair of JPMorgan Chase has tried so hard in the past several years to seem the “good banker.” He is so charming and gracious, yet all the while lobbying, cajoling, pushing, and

Gold Daily and Silver Weekly Charts - More Liquidation on Greece and Facebook

More concern on Greece and what will happen if it leaves the Euro had traders fleeing risk and commodities including gold and silver.

There is also quite a bit of secondary liquidation being done as traders raise cash for 'the Big Flip' when Facebook comes out after the bell on Thursday.

Expectations are for the stock to price in the 30's, and then run up in the secondary market into the 60's

SP 500 and NDX Futures Daily Charts - RNN Interviews Bill Black on JPM

Fears about what will happen with Greece and the Euro weighed on stocks.

There is also secondary liquidation as funds raise cash to play the big pop in the Facebook IPO which prices after the bell on Thursday.

Expectations are that the stock will come out in the 30's and pop higher to 50's at which point the momentum traders will start to flip it and hand it off to mom and pop and the pension

Max Keiser Interviews Nomi Prins on JPM and Derivatives Bets

Nomi Prins: On JPM, the Whale Man, and Glass-Steagall

This is one of the better commentaries on JPM and the history and imperatives of banking regulation that I have seen recently.

I do not wish to beat this to death, but I have read too many glib economist and stock tout comments sloughing this off as 'no big deal.' Not surprisingly, these were many of the same people who said similar things during the build up of the credit bubble and the

Partnoy's Complaint: Lawmakers Must Heed the Wisdom of the 1930s

Here is Frank Partnoy's prescription for financial reform. Essentially he says that half measures are not sufficient. Wall Street will always find loopholes in weak regulation, and they have plenty of help in this in the halls of power in Washington, and in the think tanks, universities and the media. 

Even President Obama seems to be in denial about the effectiveness of his reforms, and the

Gold Daily and Silver Weekly Charts - The Unhappy Life of Sir Francis Bacon

I ignored the markets for the most of today, although I did add a bit to my bullion position 'on the dip' as they say, and took a little off the more volatile portion of my short equity hedge.  Today was a good day to avoid the noise and reconnect with the broad perspective.

I spent part of the day rereading Dean Church's biography of Sir Francis Bacon from my library. I first came across

SP 500 and NDX Futures Daily Charts

By and large a tedious day, better spent reading than watching. High drama and all that, but the Facebook IPO awaits.

I did add some bullion 'on the dip' and trimmed up the more volatile hedge which had swollen in value.

Keiser Report Interviews John Titus of 'Bailout' Which Premieres on 16 May in Chicago

There is a fairly nice description of the 'credibility trap' in this very interesting discussion between Max Keiser and John Titus.

I had said in my major forecast from 2005 that at some point the Bankers would make the US an 'offer which they think that they cannot refuse.' The film references that sort of negotiation tactic. There is another crisis coming, and another offer which will

Carl Levin On JPM's Exploitation of the Loophole Which the Fed and Treasury Helped to Create

Carl Levin does a good job of bringing the discussion back on point again and again.

Tavakoli: JPMorgan May Be a Trading Accident Waiting To Happen

I think the next financial crisis is less than two years away, and it will strike the global real economy as badly as the banking crisis with the collapse of Lehman Brothers.

Jamie Dimon's SNAFU: JPMorgan's Other Derivatives' Losses
By Janet Tavakoli
05/12/2012

In an August 2010 commentary about JPMorgan's losses in coal trades I wrote: "The commodities division isn't the only area in which

JPMorgan Used Political Influence With Fed and Treasury to Create London Loss Loophole In Volcker Rule

"It is impossible to calculate the moral mischief, if I may so express it, that mental lying has produced in society. When a man has so far corrupted and prostituted the chastity of his mind as to subscribe his professional belief to things he does not believe, he has prepared himself for the commission of every other crime."

Thomas Paine
Using political influence with the Fed and the Treasury

Gold Daily and Silver Weekly Charts - Facebook Cometh, So Paper Prevails

More capping pressure on the metals today. With Open Interest holding steady and the accumulation patterns intact it seems more like short selling to hold down price. That can only last for so long, and is the stuff of V bottoms.

The Facebook IPO prices next Thursday and that is a 'big event' for the Street.

But let's see how Europe fares. Liquidity panics are painful in the short term.

SP 500 and NDX Futures Daily Charts - The Facebook IPO Cometh

JPM dropped a bit of a bombshell last night, as the great Jamie Dimon confessed the losses at their London based CIO 'hedging operation.'

I had to chuckle today as the Street mavens attempted to direct and deflect that event, so as not to interfere with the much awaited Facebook public offering is expected to be priced next Thursday, May 17th.

I expect that the Street will rally to the

JP Morgan Failure Shows the Incompetency of the Fed As Regulator And a Corrupted Government

...And They Repeatedly Fail to Protect the Public From It.
"How can we expect righteousness to prevail when there is hardly anyone willing to stand up for a righteous cause?

Such a fine, sunny day, and I have to go..."

Sophie Scholl, last words

The spin machine is revving up, and the spokesmodels are gesticulating wildly, in an effort to direct and deflect this failure of governance at JPM

Sharkboy Hits Dock - JPM Takes 'Significant Loss' in Derivatives Book - 'Could Get Worse'

 How Are the Mighty Fallen
“The enormous loss was just the latest evidence that what banks call ‘hedges’ are often risky bets.”

Senator Carl Levin


"From top to bottom of the ladder, greed is aroused without knowing where to find a comfortable foothold. Nothing can calm it, since its goal is far beyond all it can attain. Reality seems valueless by comparison with the dreams of fevered

Gold Daily and Silver Weekly Charts

SP 500 and NDX Futures Daily Charts

Another day another kabuki dance.

Max Keiser Interviews Chris Whalen on the Banks, And Accounting at Wells Fargo

This is an interesting discussion.  I have enormous respect for Chris Whalen, bearing in mind that he is very much a member of the banking community and this must by its very nature affect his priorities if but a little.

And of course, Max is always Max, and always interesting.  When he shifts his schtick into low gear (pun intended) he is an excellent interviewer. I wonder if Comedy Central

Michael Hudson and Pierre Rinfret: The Myth of Alan Greenspan

Although he is now passed away, and his internet site has been discontinued, economist Pierre Rinfret published some rather pithy descriptions of the people whom he had known during his long career as an economist in the commercial world, and the halls of power of the US government.    I was reminded of that today by the video from Michael Hudson which is included at the bottom.

Pierre Rinfret 

Accumulation/Distribution Trends in Gold and Silver - Building the V Bottom

The accumulation trends seem rather steady despite the recent volatility in price and protracted sawtooth downtrend.

I have included GLD and SLV in case the futures calculations had induced some distortions.

On the last chart I include the Chalkin Money Flows for GLD which are remarkably positive except for the year end selling we saw at the end of 2011.

Someone had mentioned this phenomenon

Gold Daily and Silver Weekly Charts

The miners showed a positive divergence today.

If gold is going to set up an inverse H&S bottom it must hold support at 1570 although 1580 is preferable. Otherwise we will be looking for a double bottom.

Intraday commentary here.

SP 500 and NDX Futures Daily Charts

The momentum trade has fallen into an easy pattern of lower futures prices overnight, and then an intraday rally starting around the European close.

To say that I do not trust this market is an understatement. It is running on liquidity and waiting for another fix from the Fed or the ECB.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds - Miners Rally

I see you stand like greyhounds in the slips,
Straining upon the start. The game's afoot:
Follow your spirit, and upon this charge
Cry 'God for Harry, England, and Saint George!'

Henry V, Act 3, Sc. 1
If only investing were so dramatic, and the signals so clear, as they are to insiders by privilege, and foolhardy amateurs by the dawdling nature of their inevitable insolvency.

Those of us who

The Question Is 'How Best To Default' and Not 'How Best to Maintain the Unsustainable'

"The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks."

John Dalberg Lord Acton

Greece is the most awkward of the EU countries by far in terms of economic fit.

There is no conceivable way that Greece can remain in a single currency union without regular transfer payments from the rest of the EU to compensate them for

Gold Daily and Silver Weekly Chart - World Markets Decouple from US Prices in Oil

With regard to gold and silver, the premiums on the trusts and funds, which I put out earlier today, smell more like capitulation and a forming bottom than anything else. That is, unless the markets in general 'fall out of bed' as they did in 2008 in a panic selloff seeking liquidity.

Below is an interview which Max Keiser has with Leah McGrath Goodman about the speculation in the oil markets.

SP 500 and NDX Futures Daily Charts - VIX

With earnings season almost over, jitters about Europe bit more deeply.

Key SP futures support is at 1345 with 1350 providing a potential rallying point. Below that is 1330, 1315, and 1300.

While VIX remains elevated it did not expand dramatically today which is a bit of a divergence for the short term, and helped to prompt the short covering rally into the close.

Net Asset Value Premiums Of Certain Precious Metal Trusts and Funds

Unless stock prices sell off further these premiums on the metals are more indicative of a bottom formation than anything else.

But that is a big 'if' given the risk aversion sparked by the disorder in Europe.

For long term investors, this is relatively meaningless, a great deal of noise.

Someone asked me today what will break these paper games. I do not know, but in the short term the

Bill Black: Austerity During a Serious Recession Is Economically Insane - A Warning From History

"The German’s and the ECB are not demanding any sacrifices from European elites. They explicitly target the working class and government workers’ wages and oppose any increased taxation of the wealthy. The Berlin Consensus is a road map to ever greater inequality."

Bill Black


"Thank God the US opted for bailouts and not handouts...People in economic distress should suck it up and cope."

Les Rapports de Force Entre Nicolas Sarkozy et François Hollande

Although the recent Presidential election results were close, there was in fact a more clear division of support geographically.



Link to original here.

Gold Daily and Silver Weekly Charts - Psycho Killers Qu'est-ce Que C'est?"

"Hi. I've got a tape I want to play."

David Byrne, Talking Heads
I think today was a number 36.

Do you think they could just eliminate the traders and exchanges and run the whole US futures complex with CGI from J. P. Morgan's servers?

Hi, this is Virtual Maria from the massively multiplayer NYSE...

Just take Charlie Munger's advice and put your life savings into the equity markets slot

SP 500 and NDX Futures Daily Charts - Something Is Not Right With The US Markets

"The markets are broken, and people desperately would like to see them fixed."

Joe Saluzzi

Are we supposed to take this nonsense seriously?

Oh yes, I want to put my life's wealth into something that has less integrity than carnival toss or a floating crap game.

Charlie Munger is a such a bloviating wanker.

Gold Daily and Silver Weekly Charts - Miss in Non-Farm Payrolls - Qu'ils mangent de la brioche

Miserable day for stocks and one of the worst weeks of the year for the major equity indices.

Gold and silver held up fairly well in today's equity sell off.

Happy Cinco de Mayo.

It appears that Charlie Munger believes that the people of India and the Mideast are not civilized.  And God only knows what he might say about the Chinese, including their central bank.  Don't they know they are

SP 500 and NDX Futures Daily Charts

As you have probably heard, the Non-Farm Payrolls report came in quite a bit light at 115,000 against the consensus number of 160,000.

The next move in the equity indices will be rather important.

ETFs Part 2: The Next MF Global or Trigger For a Broader Collapse - But Timing Is Everything

It is the introduction of synthetic derivatives in place of actual holdings, and the abuse of counterparty exposure with one's own organization thereby concentrating risk, that start to make these financial creatures look even more deadly, and more like control frauds, than one might have previously imagined.

I think that when one of these constructions fails, as one must almost surely do, we

Ritholtz: An Uncompromised View of Contemporary American Politics and Economics

The excerpts from this interview are to the point, and it is a rather sharp point at that.

I somehow missed them the first time around, probably due to a family illness, but someone sent this extended set of excerpts from the two interviews that Jonathan Miller did with Barry Ritholtz.

To say that Barry Ritholtz 'pulls no punches' is like saying that Joe Louis had a nice right cross.

Its a

Forbes: United States Is a Plutocracy and Academic Economists Are the Vichy

Forbes?!

Interesting piece, but what was most interesting was that it is from Forbes, 'the Capitalist Tool' business magazine, and not Rolling Stone or Mother Jones.

As Bloomberg television, and Mayor Bloomberg's city administration I might add, go full bore plutocrat, Forbes is standing for genuine reform, or at least permitting it to be discussed? As Sheldon Cooper on Big Bang Theory

Gold Daily and Silver Weekly Charts - Pete 'n' Repeat - Fed Is the 'Vampire Squid of Squids'

A bit much perhaps, ahead of the Non-Farm Payrolls.

Let's see if those are inverse H&S bottoms forming up on the gold and silver charts, or something else.





ADDITIONAL STATEMENT BY BILL MURPHY, CHAIRMAN OF THE GOLD ANTI-TRUST ACTION COMMITTEE

HEARINGS ON THE METALS MARKETS, MARCH 25, 2010


On March 23, 2010 GATA Director Adrian Douglas was contacted by a whistleblower by the name of

SP 500 and NDX Futures Daily Charts - Jitters In Front of the Non-Farm Payrolls

The Political Continuum and the Uncomfortable Center

It will be important to keep this model in mind as we go forward.

Turmoil and crisis favor polarization, and fear brings out the extremes of both sides who unfortunately tend to make the most noise, because they are often wrong but rarely in doubt.

It will be hard to maintain a centered approach if you are independent or moderate. The far right will see you as a leftist, and the far left

ETFs and Derivatives Will Be the Next Trigger Event for a Major Financial Crisis

ETFs and derivatives may be fine for a trade or a hedge to a trade, but by no means are most of them that I have looked at worthy of a long term hold.  I distinguish them by their opacity, leverage, and lack of transparent audits from legitimate physical trusts.

And some of the ETFs, especially in commodities and on the short equity side, appear to be almost fraudulent both in construction and

House May Call For Independent Counsel to Investigate MF Global

It is never the crime, but always the obstruction of justice that does them in. 

Obama may be fortunate.  The House Republicans may make noises about a truly independent investigation, but I doubt that it will happen. 

The credibility trap runs far and wide, and on both sides of the aisle.

Fox
House Republicans Expected to Call for Independent Counsel to Investigate MF Global Failure
By Peter

Bill Black: Geithner Channels Greenspan and Airbrushes Fraud out of our Crises

Tim Geithner is a creature of the system, and no doubt a part of the problem.  But only a part. He is appointed and serves at the pleasure of the President.

The root of the problem is the pervasive corruption of American politics, intellectual discussion, and public policy by Big Money.   And a culture that tolerates a total lack of shame for the abuse of power and trust in the pursuit of

Gold Daily and Silver Weekly Charts - Coiling and Capping - Azalea

The fraud will continue until confidence is restored.



This is for my good friend Harold in Canada.

SP 500 and NDX Futures Daily Charts - Shout and Feel It

ADP came in light, but the market shook it off. It is waiting for the Non-Farm Payrolls on Friday, and the next sugar high from Uncle Ben.

Be the 'Top Tweet' for Goldman - Social Media Strategist and Community Manager Needed

Gold Daily and Silver Weekly Charts - Stormy Blues - Down Don't Worry Me

Boring day really, a good day to short the stocks early after the 'better than expected' economic news, and then go out and do something useful.

And I did, making up the charts as I expected them to finish and pre-scheduling the posts.

Have a pleasant evening.

SP 500 and NDX Futures Daily Charts - Pennies From Heaven - Trickle Down Theory

Early rally on 'good economic news.' It was worth a short, to add back to the hedge on bullion.

Boring day really. A good day to work in the garden and take the pooch for a long walk. And so I did.

Eyewitness To RFK Assassination Says There Was a 'Definitely a Second Shooter'

"...Vancouver resident Nina Rhodes-Hughes — a 78-year-old American-born television actress and a local theatre enthusiast in the city's Bowen Island community — was serving as a volunteer fundraiser for Kennedy's campaign when he was fatally shot in a kitchen pantry at the Ambassador Hotel on June 5, 1968.

He died from his wounds about 24 hours later, on June 6. Five others injured in the

The Renegade Economist Interviews Ann Pettifor on Economics and the Global Financial Crisis

Gold Daily and Silver Weekly Charts - Rick's Café Américain

An early bear raid saw the gold bears stuffed.




Je n'oublie jamais, chérie.

SP 500 and NDX Futures Daily Charts - Two Highways

Occupy the SEC on Wall Street Banks, JPM 'Hedging,' and the London Whale

JPM's 'hedging' is really prop trading.

I suspect strongly that this is the basis of their 'silver hedging' as well.

Net Asset Value Premiums Of Certain Precious Metal Trusts and Funds

Premiums on gold are historically thin.

Gold Bull's Long Term Trendline - The Indispensable Chart

Although they cannot resist its inevitable climb because of the changes in the global monetary system and the ongoing currency wars, the Western central banks wish the increase in the price of gold to remain 'orderly.'

And so it is.











Thanks to my friend Nick Laird at Sharelynx.com.



Nick has one of the most amazing collections of charts on the web. 
Browsing his historical

Comex Silver Inventories - Bullion Banks To the Rescue

As I pointed out last week, inventories had fallen to historic lows ahead of the big delivery period.

The bullion banks have anticipated this and have shown some strength ahead of the period.

Stiglitz - Politics Is At the Root of the Problem

Where Stiglitz refers to 'free markets' here, he means the 'efficient markets hypothesis.' That is, if markets are left entirely to their own devices they will manage themselves, honestly and efficiently.

Government and regulation are the problem, and they distort markets. Therefore if you 'free' markets from the influence of imperfect supervision, the natural efficiency of the market will

Excerpt From 'Debt Generation' - We Are All Kettled Now

We Are All Kettled Now

30 Mar 09

 For anyone who has never been ‘kettled’ it is when the police at a protest suddenly close ranks and refuse to let anyone leave. You suddenly find you are held against your wishes. The police will not explain why, and they won’t allow any exceptions. You suddenly have no control over what is happening, and no discussion is permitted. A decision made by someone

Gold Daily and Silver Weekly Charts

Gold and Silver were held in range again, and continue to wind within the symmetrical triangles that are fairly visible on the chart.

Unless there is a major liquidity event, most likely triggered by Europe, the bias seems to the upside.

Eric Sprott warns that there are 'global shocks coming' in this interview at King World News. I think he is right.


I put a heavy hedge back on what is

SP 500 and NDX Futures Daily Charts

We had a little follow through today as the market shook off the weak US GDP number and the continuing problems in Europe.



Next week on Friday is the April Non-Farm Payrolls report.



It is well worth listening to this interview on the US economy by Richard Yamarone on King World News.



There will be no sustainable recovery until the system is reformed.  Stimulus will not work because

US Economic News Next Week - April Non-Farm Payrolls

Here is the key macroeconomic news next week in the US.



Non-Farm Payrolls at the end of the week will tend to dominate.



Otherwise its the latest European macro jitters, and of course, more US earnings reports.

Gold Daily and Silver Weekly Charts - Gold to $10,000 oz. - Walkin' On the Sun

In general I do not like to post flat out projections for anything at much higher than the current market price, but directionally I think we might be facing a market dislocation in the metals to the upside for some fairly well identified fundamental and technical reasons.

I do not think that a domestic US gold standard is inevitable at all.  I think it is still rather unlikely.

 But I do

SP 500 and NDX Futures Daily Charts - Smells Like Teen Spirit

VIX has dropped below the 50 DMA.



Stocks may be poised to break out, but GDP tomorrow may be important for any further upward progress.

US Department Of Labor Is NOT Banning 'Farm Chores' For Children

Several people sent me this news about the US Department of Labor banning farm chores, so I thought I would take a look at it.

Google news showed that the citations were all from social conservative sites, and most if not all were quoting a single site that printed this news this morning.

No major news media was carrying the story.

 Here is what I found out about it. You can read the entire

Gold Daily and Silver Weekly Charts - Jack of All Trades, And We'll Be All Right

The capping on gold and silver is hard to miss.



There was a fairly stiff gut check tossed at gold around the time the FOMC decision came out, but it bounced back quickly.



Paper and physical are in a bit of a struggle here, and so we see price winding tighter and tigher on the chart.



Intraday commentary on the financial system here.   Tavakoli 'tells it like it is.' 

Someone asked, why

SP 500 and NDX Futures Daily Charts - Apple Dumplings

APPL came in with very good results last night, and so the markets rallied led by tech.



No breakouts, so we are still waiting to see which way this goes.



Today was a good day to go for a walk.

Tavakoli: Another Financial Crisis Looming, And You're On Your Own

Janet Tavakoli takes the gloves off and tells it like it is in the cover story in the May 2012 issue of Research Magazine.


You'll have to read it here, because I doubt you would hear this in any of the mainstream media.
 
I hate to apply the overused term 'expert,' but Janet is a highly credentialed expert in financial derivatives with years of practical experience.   That does not mean that

MF Global: The Untold Story of the Biggest Collapse Since Lehman - Reckless Disregard

The question is not what the politicians and monied interests in Washington and New York will do to restore confidence in the financial system.

Rather, it is what they are willing to do, how far they will go, to save themselves and their cronies after the next financial collapse and disclosure of pervasive fraud and theft occurs. 

 From what we have seen at MF Global,  the answer is that not

PBS Frontline: Money, Power, and Wall Street

As promised, this has just become available.  You can watch the first two hours here:

PBS Frontline: Money, Power, and Wall Street


Episode One: Derivatives Spark a Credit Boom and the Mispricing of Risk


                      The Attempted Whitewash - "We never saw it coming."
                      Understates the extent of the fraud and Greenspan and others involvement in promoting a

MF Global Customer Money Unvaporized: 'Substantial Portion Went to JP Morgan'

"The final $680 million or so was transferred to other financial institutions with which MF Global did business, including a substantial portion that went to JPMorgan. Giddens said his team has "a solid basis for seeking the recovery of some of the funds that were transferred to JPMorgan," and is engaged in ongoing talks on the issue."


As they say in the trade, Q. E. D.   (quod erat

Missouri's Sound Money Bill

"I don't think this has any practical implications,” says David Rapach,
associate professor of economics at St. Louis University. “This could be
a combination of nostalgia toward both states' rights and the gold
standard, but we moved away from those types of models for good
reasons.”

Perhaps the good professor has never heard of Gresham's Law, or seen The Hunger Games.   But it does fit

Michael Hudson and Max Keiser - Beggars Without Borders - Is the EU the New AIG?

The more I examine the financial, political, and economic structure of the European Union, the less sustainable and sensible it appears.

Having a common currency without allowing for transfer payments to make up for the lack of a flexible currency exchange is almost incredible considering the diversity of the region.

And when one adds the fact that each country is expected to issue its own

Gold Daily and Silver Weekly Charts - Winding Winding...

There is little doubt that gold and silver are being 'capped' here.  

The question is which way they will break out and up, or down, as the winding tension in the market becomes unsustainable.

SP 500 and NDX Futures Daily Charts - All Eyes On AAPL

All eyes are on AAPL which reports earnings and revenues at 4:30 PM.


Tomorrow afternoon is the FOMC rate decision, and on Friday the advance GDP number from Q1.

US Leads Developed Nations In Percent of People In 'Low Wage Work'

This could be a good question on a quiz.



With regard to Victorian England I have seen estimates that show that almost 20 percent of workers were 'in service,' that is, were employed as domestic servants.



I see where they are already bringing back debtor prisons in the States.

And Australia and New Zealand are falling behind it appears.
  Some stubborn fascination with equality no doubt,

Gold Daily and Silver Weekly Charts - Two Day Fed Meeting Weighs on Metals

The money-printers will announce their latest decision on Wednesday around 2:15 PM, after their two FOMC meeting.

Gold and silver typically sell off into such meetings so today was no real surpise. The correlation with the equity markets allowed our short stock hedges to function well.

I put out the latest Net Asset Value premiums this afternoon, and PHYS produced a fairly surprising .94%

SP 500 and NDX Futures Daily Charts

700 million shares had traded on the NYSE at the bell, and that is light, and symptomatic of the lack of broad participation in this market. Shares are getting tossed around like hot potatoes among speculators and trading programs, with little conviction.

The two big pivot points of expected news will be on Wednesday when the Fed reports its FOMC decision and economic outlook, and on Friday

Net Asset Value Premium of Certain Precious Metal Trusts and Funds

The premium on PHYS is about as low as I can recall seeing.

It is so low that I checked for news of a secondary offering but found none.

Weekly US Economic Calendar

The Fed has a two day meeting and will report their decision and outlook on Wednesday.

The US will report the Advanced GDP number for Q1 on Friday.

Banking On Fear: Why the Policy of Stuffing the Banks With Money Does Not Help the Real Economy

"The big banks are buying up what they call fixed income instruments (bonds and other debt backed paper) and at the same time offering CDS insurance on the same. Just like they bought and sold protection on mortgages..."This is a fairly good description of why the policies of Bush and Obama have failed to effect an economic recovery.

The policy of 'saving the banks' first and foremost, and of

The Case Against Lehman Brothers - The Credibility Trap

This documents the investigation into Repo 105 and the fraudulent transfers between New York and London, and when the accounting firm of Ernst & Young knew of them. The SEC and the Federal Reserve were there at the company, with access to the records, when all this happened.

And of course, there have been no indictments. And the reason may be that the SEC and the Fed, in their desire to

Max Keiser Interviews Gonzalo Lira On the European Crisis

Currency Wars: Rickards On Gold, QE, and the Economy

Jim Rickards is interviewed by FutureMoneyTrends.com.



Part 1 is focused on Gold manipulation and why gold plays such an important role in the world, even if conventional wisdom doesn't believe so, gold is not only being watched by central bankers, as Mr. Rickards put, "the gold price is being managed."






Part 2 expands into the economy and probability of more quantitative easing (QE).

Gold Daily and Silver Weekly Charts - Winding Into the Apex, Slowly

SP 500 and NDX Futures Daily Charts - A Lazy Wind into the Weekend

Comex Silver Inventory Watch - Heading Into May-July Delivery Period

The long term decline in deliverable supply at this price level could become quite interesting.



The only ways to obtain more deliverable inventory to meet a bulge in demand is to game the rules on the ability to take physical delivery or let the price rise by buying on the open market.

   

The push by the CFTC for position limits may tighten the ability to take delivery from 1,500 to

Goldman Sachs Employee Facing Insider Trading Probe

And the fails just keep on coming.

They will toss the small fry while the big wheel keeps on turning.

Reuters
Goldman Sachs facing a new insider trading probe
By Emily Flitter

NEW YORK (Reuters) - Federal prosecutors in California are investigating a Goldman Sachs employee for insider trading, according to prosecutors and defense lawyers who attended a hearing in U.S. federal court in New

Double Barreled Blast of Max Keiser and Matt Taibbi (With Outtakes)

Wall Street as organized crime.  An excellent discussion with Matt and Max.




The entire show including the first half with Stacy Herbert discussing Goldman Sachs and their $22 million dollar fine for sharing unpublished info between analysts and traders is here.


Outtakes from this week's Max Keiser Show (with Matt Taibbi As Max's Samoan Attorney)



The businessman in a suit is a young

Gold Daily and Silver Weekly Charts - Winding Up for a Move - Tomorrow Is Stock Option Expiry

The trick in trading is not to 'predict' in advance which way the metals will break in the short term, or any market for that matter. I have seen plenty of guys waste their trading accounts and their time trying to find 'the perfect system.' 

Believe me, if there was such a system, you would not find it.   And especially you would not find it on a publicly available site.

The best system

SP 500 and NDX Futures Daily Charts - Coiling Ever Tighter Into the Apex

VIX remains above the 50 DMA but fairly low so the 'yellow flag' is out.

Hedges in place.

As a reminder tomorrow is stock option expiration.

A Message on the Need to Reform the Financial System -- From Herbert Hoover

This speech was given by Herbert Hoover as the country was caught in the depths of the Great Depression 6 December 1932, as he was leaving office, largely perceived as a failure.

I have sympathy for Hoover and rightfully so. For many years I saw his portrait every time I would visit the headquarters of the IEEE in New York City. I read about his magnificent acts of logistical organization and

Frontline: Money, Power, and Wall Street

Coming April 24 and May 1, four hours in two parts.

There has been no genuine and effective reform, and no real recovery. And there is clear and present danger of another financial market collapse.

The truth of what really happened was led down a blind alley, and strangled. And no one saw or heard anything.

When it becomes available I will put up a link for those who would access it via

A Study On Speculation in the OIl Market For Those Economists Who Have Apparently Not Seen It

Here is a study from the St. Louis Fed on Speculation in the Oil Market that indicates that speculation contributed about fifteen percent to the increase in prices in the oil market during a recent price increase.

Anyone who trades these markets and follows the real economy does not require such a study to tell them what is plainly visible to their own eyes, especially when the studies always

Bill Moyers: It Pays To Be Rich - And a Tribute to Bernard Rapoport

It's all part of Obama's Raw Deal.

If he is Hoover, what is Mitt? More of the same, or something a little more edgy perhaps.

And as a counterpoint to mindless greed and the cult of self, a touching and moving tribute to Bernard Rapoport, who was fully human, greatly loved, and a great man, a pillar in the stream of a generation that has lost its way and its honor, and has forgotten the

Gold Daily and Silver Weekly Chart

Intraday rant about market speculation and manipulation here.

SP 500 and NDX Futures Daily Charts

These markets are wound a bit tightly, and may break in either direction probably based on some stimulus or trigger event.

They are thirsty for liquidity and real investment and must have one or the other. Real investment is sidelined by fear of corruption and has been chased to the sidelines by rampant speculation by the HFT cowboys.

Bart Chilton of the CFTC Discusses Position Limits - Economists Remain Craven, Compromised, Blind

Bart Chilton discusses position limits and commodity price manipulation with Becky Quick and her assistant.

Silver is mentioned at about 5:35 on the tape.

'Speculators' might be confused with 'investors' if you come from the land of the privileged hedge and vulture funds.

Speculators look for market inefficiencies and exploit them, thereby contributing to price discovery in a healthy market.

The 'Raw Deal'

Senate Banking Committee to Hold MF Global Hearing Next Week

"How can people trust the harvest, unless they see it sown?"

Mary Renault

Here is the cast of players for the next Senate Hearing on MF Global as reported by the NY Times.

The problem that this hearing will seek to address is the lack of confidence in the markets and how to restore it.

The appearance of Mr. Freeh is new, and the characterization of it by the Times is interesting.

I doubt

Gold Daily and Silver Weekly Charts - Bear Raid Breaks Momentum

The paper money munchkins and metal bears are making their stand for gold at $1650 and silver at 32. That seems fairly obvious. They will hold it until they cannot, and then will fall back to defend a slightly higher price level. I like to think of it in American football terms. The bulls are going for a first down, and the bears are trying to hold them back.

Silver came in this morning

SP 500 and NDX Futures Daily Charts - Risorgimento della Gola

The IMF raised it's world growth projections from 3 to 3.5%. Since the only group that is worse than the IMF projecting growth rates is the Fed, I think we can write than one off to jawboning at best, but nothing of lasting substance.

The rally was in part a wash and rinse, a way to catch the bears off balance, and was triggered largely by India which cut interest rates by 50 basis points.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

The premium in PSLV for silver remains historically low.

I thought the bear raid this morning was all about breaking the upward momentum in silver in order to keep gold under wraps at 1650.

More on that later in the gold and silver commentary.

The Quebec Students Strike

"But the most interesting resistance happening right now is going on in Quebec, Canada. There are, according to one representative report, over 165,000 students on strike from class out of a 495,000 student body.

Quebec is looking to increase their tuition 75% over the next several years; students responded by starting what is now the longest strike in the province's history. It's gone on

SEC Charges OptionsXpress with Naked Short Selling Scam

And the fails just keep on coming.

MF Global was check-kiting (in addition to outright theft) and OptionsXpress was 'stock kiting' in some targeted and fairly impressive volumes.

Their mistake was involving the retail side of the trade.   Naked short selling and price manipulation is only permitted for professionals of TBTF institutions and  campaign contributing hedge funds.

Bloomberg

Gold Daily and Silver Weekly Charts

Gold closed about where it had opened on Sunday evening, and silver closed slightly higher.

And yet the miners took a minor beating as it were.

SP 500 and NDX Futures Daily Charts - No Resolution Yet

There was no clear breakout or breakdown on stocks.

There is also a strong possibility that we move to a sideways chop from here to the next big market move in May.

Why Has the American Economic System Failed, and What Are We Going To Do About It?

"We always want to keep in mind what the function, the purpose, of the economy is. The purpose of an economy is not producing GDP. It is increasing the welfare of citizens, and it is increasing the welfare of most citizens. And the American economic system has failed, and failed very badly. Most Americans today are worse off, most American households have lower real income adjusted for inflation

Joseph Stiglitz: Is Mercantilism Doomed to Fail? And With It the US Dollar?

This is Joe Stiglitz' presentation at the INET conference in Berlin last week. He speaks about mercantilism, and I added the tagline about the dollar.

The one point I wish to make emphatically is that only under a fiat currency trade system can these large deficits and surpluses be created, in the same manner as the debt bubbles, and asset bubbles.

This is not a new idea, of the natural

Michael Hudson: Debt: The Politics and Economics of Restructuring

I have been watching the presentations from the New Economic Thinking's (INET) Paradigm Lost Conference in Berlin.

Here is Michael Hudson's talk on Debt and Restructuring from April 13, 2012

The Criminal Manipulation of Food and Commodity Prices

Michael Greenberger of the University of Maryland has been an outstanding spokesperson for financial reform.  I have carried his interviews before.

He served on the CFTC with Brooksley Born in the late 1990's. This is how I first became aware of his opinions about regulatory matters.

I had hoped he, among some notable others, might have found a place in the Obama Administration if it had

Saving Capitalism From the Capitalists: Are the Trading Desks Destroying the Futures Markets?

Dan Norcini is my friend, one of the more savvy people I know in the markets. He has made his living as an off-exchange trader for many years. The concerns he has about the viability of the markets is genuine, and of great importance.

People forget the reasons why some markets exist, what their function in support of the real economy is fundamentally all about.

The responsibility for this

Gold Daily and Silver Weekly Charts

Gold and silver both gave up gains today as it was 'risk off' in the markets and at least for today that meant the metals went lower.

The chart formations on the daily price charts are obvious. What is not so clear is what the market is going to do with them, since we are in the sort of situation where we must wait for the market to signal which way it is going to break out of some big

SP 500 and NDX Futures Daily Chart - Risk Off in the Wash and Rinse Cycle

Wells Fargo set record profits this morning and JPM beat the numbers.

Despite this stocks slumped giving back their gains from yesterday.

Citi reports before the bell on Monday and the Street is pessimistic.

For Capitalism to Survive, Crime Must Not Pay

There are too many people in the financial sector, with their enablers, familiars, and camp followers, engaged in distorting markets and public policy discussions while collecting their enormous and counterproductive entitlements from corruption, fraud, and the misery of others.

They are crippling the economic recovery. These are not 'job creators' or even real wealth creators; they are con

Gold Daily and Silver Weekly Charts

To say that these are fairly cynical traders' markets, rather than anything tied to fundamental valuations, is an understatement.

The trading desks engage in heavy handed bear raids, smacking the price of bullion and related markets like miners down lower, and then ride them slowly back up to trend.

Wash, rinse, repeat.

There are far too many people in the financial sector collecting the

SP 500 and NDX Futures Daily Charts - Wash, Rinse, Repeat

A continuing rebound in the trend channel, as the Street anticipates more sugar from Uncle Ben.

Securitization - The Undead Heart of the Shadow Banking System

Here is a study of the shadow banking system, and what changed that helped to fuel the credit bubble and the financial collapse.

The root of this was in the overturning of the Glass-Steagall, the well funded lobbying effort for deregulation in the financial sector under the banner of the efficient markets hypothesis and the trickle down theory, and of course, a systematic undermining of

Net Asset Value of Certain Precious Metal Trusts and Funds

The premium on PSLV remains rather low by historical standards.

SP 500 Futures IntraDay

This is obviously a bounce off the longer term trend, that is now starting to challenge the short term downtrend.

Gold Daily and Silver Weekly Charts

Intraday commentary on the eurodollar and gold here.

SP 500 and NDX Futures Daily Charts - Bounce - VIX Remains Slightly Elevated

Stocks bounced today after the big decline yesterday in part because of some optimism on earnings after last night's Alcoa beat.

The rally was a bit subdued. Let's see if more earnings come in positively.

Eurodollar Update - Hunting The Black Swan - Gold and the Eurodollar

As you know eurodollars are US dollars held anywhere overseas by banks as a foreign currency liability or asset.

Eurodollars were formerly tracked by the Federal Reserve and were included in their M3 figures. In fact, the reason that the Fed stopped issuing its M3 is because it stopped tracking eurodollars. The other components remain.

But the Bank for International Settlements, or BIS,

Comex Registered Silver Inventory Falls Below 30 Million Ounces Again

Comex Registered Silver inventory has dipped back below the 30 million ounce level as deliveries and withdrawals bring it back down near historic lows.

Perhaps they can lease some from SLV as the situation may require. The central banks may stand ready to lease increasing amounts of gold for sale into the markets if the price rises too fast, as Mr. Greenspan had said, but they are fresh out

Mike Maloney on Gold and Silver Manipulation

Gold Daily and Silver Weekly Charts - Remarkable Flight to Safety on Euro Jitters

There was a remarkable intra-day reversal in gold as stocks slumped hard on fresh European debt jitters of the Italian and Spanish variety.

This divergence was probably a flight to safety, as gold soared but silver lagged.

Gold had also come to the bottom of its short term trend channel, so the selling algos were likely a bit old.

I did some buying in the early part of the day as gold and

SP 500 and NDX Futures Daily Charts - Sharp Correction on Risk Off

The equity markets sold off sharply today on fresh jitters about the sovereign debt of Italy and Spain.

It is also quite important to remember that stocks have been very overbought short term and were ready for a correction.

Gold Moves Sharply Higher For No Particular Reason Yet Seen - Remarkable Divergence

I am checking various rumours, but so far nothing in the news can explain this remarkable short term rally in gold.

I am not going to bother repeating the rumours at this point, as they are mere speculation in my opinion.

This is a significant divergence from the equity markets. Silver also has rallied, but lagged a bit.

I would not chase it here, although that is easier for me to say as I

Gold Daily and Silver Weekly Charts

A pop up rally on expectations that the demise of QE is greatly exaggerated.

I have rarely seen a market that is subject to so much blatantly phony 'commentary' as the metals market.

The talk on Bloomberg financial television this afternoon was that the Jobs Report was misleading, and that more people are not working because they want to 'take it easy.' 

The unemployed just want to retire

SP 500 and NDX Futures Daily Charts

Earnings season kicks off after the bell tomorrow with Alcoa.

A fairly moderate reaction to stocks in the first day of trading after the 'big miss' in the Jobs Report last week.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

JPM Trader Bruno Iksil Driving Derivatives Markets with 'Massive Positions' and 'Excess Capital'

A secretive JPM Trader in London, alternatively known as 'the London Whale' or 'Voldemort,' is distorting the credit derivatives markets with massive positions, and a willingness to move them advantageously in the markets.  It is a classic case of gambling with other people's money, in this case the excess capital provided by the Fed and the Treasury.

I am sure they are all legitimate hedging

Bill Moyers Interviews Paul Volcker: Gambling With Your Money

Gambling With Your Money - Bill Moyer's Journal

Blythe Masters Speaks Out On JPM and Market Manipulation: Take Our Word For It

A number of people have asked me what I think about Blythe Masters' interview on CNBC in which she categorically denies that JPM is involved in anything but legitimate hedging of customer positions in the silver market.

I think a detailed description of all of JPM's hedging positions in the futures and derivatives market, and the related customers and bullion holdings, should be supplied to

MF Global Trustee Giddens in 'Substantive Talks with JPM' Over Return of Stolen Customer Funds

It is nice to see that JPM is cooperating with Mr. Giddens, who is investigating their role in the funds that were stolen from MF Global's customers.

It remains to be seen how much, if any, money that they will return.

But it is good news to see that someone is stepping up besides the Commodity Customer Coalition.

It will be interesting to hear what Edith O'Brien will disclose when she

Gold Daily and Silver Weekly Charts - The Dr. Evil Strategy and Some Targets

"The exact methodology being deployed that enables the dominant commercial traders to pull this scam off repetitively, aside from outright collusion, is High Frequency Trading (HFT). HFT is the collusive bundling of advanced computer hardware and software that is so advanced and powerful that it has achieved the power to move prices sharply with little actual trading required in setting prices.

SP 500 and NDX Futures Daily Charts - Why Is This Market Like Every Other Market?

The markets today were marked by thin volume and largely artificial intra-day price movements. Traders were squaring off ahead of the three day weekend so there was a slight downward bias except in tech, which was cheered by the awarding of the Facebook IPO to the NASDAQ, and of course, perpetual Apple-mania.

Cautionary words about Europe and the upcoming earnings season had the markets on

Unfulfilled Dreams: A Tension At the Heart of the Universe

"...So many of us in life start out building temples: temples of character, temples of justice, temples of peace. And so often we don’t finish them. Because life is like Schubert’s "Unfinished Symphony." At so many points we start, we try, we set out to build our various temples. And I guess one of the great agonies of life is that we are constantly trying to finish that which is unfinishable.

MF Global: The Awkward Construct of a Dual Bankruptcy and the Two Trustees

I outlined the somewhat adversarial relationship between the two trustees due to the odd and awkward construct of the bankruptcy a few days ago. Louis Freeh Asks for $25 Million From MF Global Estate to Pay the Defense Costs of Corzine and Execs.
"I am not an attorney and have never been personally involved in a bankruptcy so I am not particularly knowledgeable in the finer points of US

Gold Daily and Silver Weekly Charts - Even the Orchestra Is Beautiful

Each and every market maker a virgin. If you don't believe me, don't take my word for it, go ahead, ask Helga.








Betty and Helga

SP 500 and NDX Futures Daily Charts

Oh Say Does That Star Spangled Banner Yet Wave...

Chinese Premier Wen Jiabao Says They Must 'Break Up Their Big Bank Monopolies'

What a world, when the premier of China sounds like Andrew Jackson and Teddy Roosevelt.  His observations of the problems they face with the biggest banks in China must surely resonate with people in the developed nations.

I do not know how to translate this into Chinese, but the Premier is free to use it in his speeches:
"The Banks must be restrained, and the financial system reformed, with

JPM To Pay 'Wristslap Fine' in Misuse of Customer Segregated Funds at Lehman Brothers

JPM extended a significant amount of credit to Lehman Brothers prior to their collapse.

In extending the credit, JPM assumed that the customer money that was being held by Lehman Brothers could be freely used by the firm, and therefore was a legitimate part of its valuation. The comparison to MF Global is obvious.

In other words, if MF Global had not failed to meet its margin call and gone

When Is QE Not Really QE, a Bailout Not Really a Bailout?

When the going gets tough, the sneaky take it off balance sheet.

Watch carefully what the Fed and the Treasury do, not so much what they say.

Times of India
IMF chief calls on US for more cash
3 April 2012

WASHINGTON: IMF managing director Christine Lagarde implored the United States to help back-stop debt-ridden European countries Tuesday, wading neck-deep into bubbling US political waters.

More Evidence of Fraud: MF Global's Inscrutable Accounting Error - Who Shot Jon?

"The theory is that someone at the firm overrode internal controls that safeguarded customer funds and transferred money out of them to shore up the company's global liquidity position. Congress and federal investigators are particularly focused on the role of Jon Corzine, the former CEO of Goldman Sachs and governor of New Jersey, and whether he purposely directed his treasury department to use

Gold Daily And Silver Weekly Charts - FOMC Minutes Trigger a Sell-Off

The FOMC minutes at 2 PM NY time set off a sell signal in gold of about 2.25%, and to a lesser extent stocks .90% and silver which was down 1.44%.

All three recovered somewhat into the close.

These are highly manipulated markets, so tread carefully. It is better for most non-professionals to be out of them, and to have their wealth stored in honest assets as far away from the Anglo-American

SP 500 and NDX Futures Daily Charts - Desperately Seeking Buyers for the Bernanke Bubble

The FOMC minutes precipitated a drop in the markets.

Gold and some of the miners were hit hard, with silver, bonds and stocks down to a lesser extent. The US dollar rallied.

The rationale was that there would be no QE and that perhaps the FED would raise rates. Given the recent data from income tax receipts and wages this appears to be more a fantasy than a sound fiscal policy.

I don't

Remembering the 44th Anniversary of Martin Luther King's Last Speech

Martin Luther King's Last Speech

3 April 1968, Church of God in Christ, Memphis, Tennessee



On 4 April 1968, Dr. Martin Luther King, Jr. was assassinated.

O Jerusalem, Jerusalem, you who kill the prophets and abuse those whom God has sent as messengers to you, how often I have longed to gather your children together, as a hen gathers her young under her wings, but you would not let me.

Net Asset Value Premiums of Certain Precious Metal Trusts and Funds

The FOMC minutes at 2 PM NY time set off a sell signal in gold of about 2.25%, and to a lesser extent stocks .90% and silver which was down 1.44%.

Reggie Middleton On Bank Fraud and Financial Ponzi Schemes

Financial analyst Reggie Middleton is interviewed on a range of topics by Max Keiser.
- Fed bought 61% of new Treasury debt issuance distorting markets
- Higher oil prices are due to monetization of the currency and not increased demand
- Higher education has all the characteristics of a debt bubble
- Big name investment banks are taking advantage of their clients in order to make short term

McKenna: JP Morgan Chase Knew MF Global 'All Too Well'

"JPM had a history with Dennis Klejna. He was the head of compliance at Refco when that firm failed. JPM was one of the underwriters of the Refco IPO and agreed in April 2010 to pay $49.5 million to settle a shareholder lawsuit over that firm's collapse less than two months after going public in 2005...

Klejna was not criminally charged over his involvement in the Refco fraud, but he did sign a