Silver, Riots, JPM and More
First off the ugly. The really really ugly. As far as I can tell the concept of "law" has left our land. How sad. A jury of women, most with kids, could not find a way to convict Zimmerman of the charges the state brought to him. The decision was unanimous. That is quite telling considering the incredible media pressure, the incredible push the Prosecutor and the judge were displaying and the incredible scope of the trial.
Yet though found not guilty, the "specially appointed" Prosecutor Angela Corey has been all over the air waves stating such things as Zimmerman is a "murderer". Oh my. So, in the United States of America, a Country that says it is so wonderful because we are a nation of laws, if the prosecution was a farce to begin with and couldn't railroad Zimmerman into prison AND the jury finds him not guilty, according to Angela Corey he's a murderer with illegal thoughts. No regard for the legal system she supposedly upholds. HER legal system tried this man, and found him not guilty. What right does she have to call him that AFTER acquittal? I'd sue her for defamation.
And just as expected all across the nation we're seeing some members of the black community do what they said they'd do on various twitter accounts. They're wilding, rioting, stomping cars, setting fires, smashing windows and beating up random people. They said they would and they are. I am disgusted at the way our nation has back tracked to such a low state of affairs.
Looking across our land right now, what do you see? Financial manipulation as our silver and gold markets are rigged daily. A stock market that cares not about earnings or valuations, simply "stimulus". Rising racial tensions. Violent protests in over 30 cities with more to come. Employers only hiring part timers because they can't deal with Obama care's expense. A Central Banker that's printed trillions of dollars to ignite an economic resurgence in a dead economy. Entire cities that are bankrupt. Soaring medical costs. Rising energy costs. Stagnant and falling wages. A debt load impossible to ever pay. Shall I go on? I don't have to.
We appear to be devolving into something quite ugly. A perfect storm of economic implosions coupled with rising racial tensions. Rule of law being perverted at will. Long gone is the "old fashioned" America where any young person could stumble down the street and find a life long job at the local factory. Today there's no such thing as security of any kind, and competition is brisk. Add in ever escalating social tensions and we do indeed have the ability to see some very nasty things in the not too distant future. I think it is telling when the top selling prescription drugs in a nation are tranquilizers, antacids, and erectile dysfunction pills.
So, how do we get past all this? How do we continue to live lives that have meaning and are still "fun" while we see all this in the background? The answer to that will vary with the type of person you are. But I've always been satisfied with the idea of preparing for the worst, and hope for the best. By preparing for the worst, I mean both economically and physically. It is no secret that for 12 years now we've been preaching to anyone that would listen that buying gold was the single best thing they could do. Then in 2007 we added silver to that list. If the dollar is going away, if the entire global financial situation needs a reset... then replacing fiat dollars with a precious metal still sounds responsible to me.
Recently we've seen major things happening in gold and silver. In gold we've made mention several times about the fact that gold is in backwardation, a situation it should never find itself in. Then we see the major banks changing their futures contracts holdings from net short, to net long. Recently we see JPM has demanded physical delivery for its silver contracts, something quite rare in the futures business. ( Most commodities are bought and sold for the dollar gains, not really to take possession of the underlying asset. By demanding delivery, the supply system will indeed be in for a shock if this persists)
We've seen multiple countries now requesting their gold to be delivered back to them from the various Central bank vaults. We know there's a shortage of the physical metal or it wouldn't take Germany over 7 years to get her gold back. Meanwhile the statistics show that China and several other countries are adding to their gold stockpile. "Something" is in the wind and it feels like what ever it is, it is getting closer all the time.
In the immediate "near term" you have to consider your physical safety. There are very ugly things taking place in just about every "big" city across the nation. Do your best to avoid areas where large groups can or are forming, as it is easy to get trapped in something like that. With any luck this will settle down in a while and we can go back to worrying about the economic nightmares we face, but with all the violence taking place right now, personal safety is paramount. Be careful out there.
The Market....
Bernanke is talking to Congress for two days in what used to be called "Humphrey Hawkins" starting today. Here's something that should get me red flagged on all the NSA computers...Bernanke is a liar of the highest order. My jaw hit the desk a few times during his talk today, but most of it I could give a pass on because he was simply lying about the economy. But at one point this little spinner head had the audacity to say "WALL STREET HASN'T BENEFITED MORE THAN MAIN STREET".
How incredibly smug and arrogant can a person be? While most of "Main Street" is scared to death of losing their part time jobs, bonuses and Salaries at Wall Street banks is soaring. People with the wherewithal to be able to hold stocks have seen their fortunes increase. Those little people on Main Street only see their expenses increase. It was bad enough listening to him jump from timing the removal of QE to "it seems that excessive amounts of accommodation will persist into the future"..but to have him tell us that Wall Street hasn't benefited? What a pompous punk.
Didn't Bernanke buy up toxic sludge mortgages that Wally Street bankers had on hand? He did. Doesn't Bernanke buy his bonds from the Wall Street Primary Dealers giving them massive profit? Doesn't he still allow "mark to model" fantasy accounting, turing Banking losses into supposed profits? He does. So just what did main Street get? Debt payments, that's what Main Street got.
The Federal Reserve is as criminal now as it was when they implemented it almost 100 years ago. It is unconstitutional and Frankly we would NEVER have had the bubbles and Bursts we've experienced for the last 30 years if they didn't exist. Normal market cycles would have kept things in balance. The single Best thing Bernanke could do to save the Country is disband is criminal cabal. Fat chance of that.
Consider something for a moment. The FED's say they want 2% inflation. For years they've got everyone believing that it is just wonderful that our currency devalues by a couple percent every year. How insane is that? Inflation means that our currency is literally "worth less" each year and these lobotomites want "more" of it. And yet if you ask, the so called "economists" will tell you that it is good for growth. NO IT ISNT. It's good for bankers. It's good for debtors. It stinks for "people". Yet we go along with it like idiot children.
And as usual the market was hostage to his babbling. He'd talk hawkish for a bit and the market would fade red by 25, then say something dovish and up we'd go by 30. Then back down to red only pop higher again. It was quite evident to me that they really don't have a clue what they're doing. They're making it up as they go.
So, we ended the day with 18 points to the green. That's statistical noise in a 15K market, and proved nothing. As I said way back on Sunday, I don't' suspect we'll really know if we're going to fade off some and consolidate or blast higher until Friday when they've had enough time to think out Bernanke.
My "guess" is that they'll come to think that nothing has changed and Benji's going to keep the presses oiled and running hot. If that's right, there's no reason other than the wildly overbought technicals to keep them from gunning it. That hasn't stopped them in the past, and probably won't now.
Is it incredible? You bet. No one in their right mind would be buying stocks at this level if we were anywhere near a normal market. But normal went out with the tides years ago, and this is the new normal. A market completely attached to the breast of our Central Bankers money press. How absurd. Yet how real.
We'll see you all on Sunday.
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