14 March 2018

Stocks and Precious Metals Charts - What Can I Do?


"Which of these three was a neighbor to him?  Go and do likewise."
"Jesus gave us a new norm of greatness.  If you want to be important—wonderful.  If you want to be recognized—wonderful.  If you want to be great—wonderful. 

But recognize that he who is greatest among you shall be your servant.  That is a new definition of greatness...  Everybody can be great,  Because everybody can serve.  You only need a heart full of grace, and a soul generated by love.  And you can be that servant."

Martin Luther King


"Non serviam.  (I will not serve)."

Lucifer

Stocks were wobbly most of the day. An effort to take the big cap tech stocks fizzled, with the Dow and the SP 500 lagging most of the day.

Gold and silver were listless. The Dollar finished unchanged.

As a reminder there will be a stock option expiration on Friday.

We will see Jay Powell's first FOMC meeting as the Chairman next week.  A 25 bp rate hike is widely expected.

Have a pleasant evening.














Stinging Commentary on the Democratic Party Establishment


"There is a lack of critical assessment of the past. But you have to understand that the current ruling elite is actually the old ruling elite. So they are incapable of a self-critical approach to the past."

Ryszard Kapuscinski


Now we remember that it was Bill Clinton's administration that deregulated derivatives, deregulated telecom, and put our country's only strong banking laws in the grave. He's the one who rammed the North America Free Trade Agreement (NAFTA) through congress. Mass incarceration and the repeal of welfare, two of Clinton's other major achievements, are the pillars of the disciplinary state that has made life so miserable for Americans in the lower reaches of society. He would have put a huge dent in Social Security too, had the Monica Lewinsky sex scandal not stopped him. If we take inequality as our measure, the Clinton administration looks not heroic but odious.

Mounting a campaign against plutocracy makes as much sense to the typical Washington liberal as would circulating a petition against gravity.  What our modernized liberal leaders offer is not confrontation but a kind of therapy for those flattened by the free-market hurricane: they counsel us to accept the inevitability of the situation.

Thomas Frank, Rendezvous With Oblivion, 1 September 2006







13 March 2018

Stocks and Precious Metals Charts - Jumping the Shark


"Businesses invest to meet anticipated or actual demand. Not because they have more money. Why is there little demand, not business investment, is the real question. Demand is weak because there is little increase in disposable income for all but the wealthy and high end professionals

Isn't it rather premature to render such evaluation at this point? Maybe. Spokesmen for corporate America confirming to White House thus far primary use of corp tax cuts will be buybacks and dividends. White House did not expect that outcome, should have asked SEC to have fresh look at SEC reg 10b-18 to curb execs use of buybacks at time of tax cuts...

Ultimately the key question ahead for Fed & other Central Banks is how to manage deleverage of economies and financial markets w/o a market crash from such a high level of debt--or at least moderate a downslide."

Dr. Harald Malmgren, twitter 3/13/18

The big news was when President Trump fired his Secretary of State Rex Tillerson.

Trump and Tillerson disagreed on a number of points, particularly the current accord with Iran, and the general approach of using diplomacy and partnering with allies, rather than beating the war drums and trying to go it alone.   I think there are points to make for and against both approaches.

The manner in which Tillerson was fired by a public tweet while he was out of country was about as low class a form of management that you might see.  He did not even get a personal phone call until around noon.

This management style is unworthy of anyone occupying such an important position. 

I could not see anyone with real world accomplishments and self-respect wanting to sign on for this Cabinet, unless it is for some specific purpose or ambition.   You know, like Gary Cohn sticking around only long enough to help pass huge tax breaks for his cronies.

And speaking of  unworthy opportunists, Trump's choice of Larry Kudlow as his Chief Economic Advisor is mind-boggling.  Kudlow is not an economist, being primarily a spokesmodel for Wall Street and a media personality. 

The markets took all this disarray in the most powerful government in the world a bit hard. And so stocks gave up any pretensions of a higher leg up today, and dropped with some conviction and volume for a change.

The Dollar also dipped, giving a little boost to the precious metals.

The CPI number came out mild, and within expectations. I don't think this will have any impact on the FOMC, which wants to raise rates for its own purposes. I think we are on course for three rate hikes unless the wheels fall off the stock market. The FOMC will raise rates 25 bp next week.

There will be a stock option expiration this Friday, so we might expect more gimmicky market moves as the Street continues to suck the life out of the American economy and the mechanisms of capital formation and distribution.

Have a pleasant evening.



12 March 2018

Stocks and Precious Metals Charts - The Primacy of Conscience


"All my life I have been fighting against the spirit of narrowness and violence, arrogance, intolerance in its absolute, merciless consistency.   I have also worked to overcome this spirit with its evil consequences, such as nationalism in excess, racial persecution, and materialism.  In regards to this, the National Socialists are correct in killing me.

I have striven to make its consequences milder for its victims and to prepare the way for a change.  In that, my conscience drove me – and in the end, that is a man's duty."

Helmuth James Graf von Moltke,  Executed in Plötzensee Prison on 23 January 1945

As journalist activist Carl von Ossietzky put it, 'we cannot hope to affect the conscience of the world when our own conscience is asleep.'

Heroic virtue shines across the vast seas of history like beacons to those in the troubled waters of general deception.

Stocks were led by a narrow group of big cap tech related stocks, with the NDX 100 driving all the gains.

Tomorrow we will have the CPI data, which *could* move the market. Some of the yield related futures are pricing in a four rate hike year. A strong CPI number may encourage that.

Gold and silver showed some mild strength, not as a flight to safety, but mostly off a slightly weaker dollar.

When traded as currencies, the precious metals are decoupled from their fundamental supply and demand dynamics as commodities.

Next week will be Jay Powell's first FOMC meeting. The Fed is widely expected to decide on a 25 bp rate hike.

This Friday is a stock option expiration. We may see some shenanigans on the precious metals related stocks.

The CBOE put-call ratio is back to the pre-meltdown levels.

Corruption and deception remain the coin of the realm in the halls of power in New York and Washington.

Have a pleasant evening.