"Why do the economists continually excuse outrageously unsustainable economic behaviour and financial systems that are as productive as games of chance? Why do some media outlets obviously take sides and pander to the worst biases in their viewers, supplying them with easy reflexive answers to any suggestion that something might actually be wrong? Why do adult people fall for this and regress to childish name calling so readily?
It is because they are afraid. They know the system is broken, that the country is in for hard times, and that the work of reform is going to be difficult and painful. It is so easy to adopt whatever red or blue meme, whomever you think is going to deliver undeserved wealth to you, or at least safety and position. As always look for a fallguy, some identifiable and out of favor group. The search for scapegoats may be be violent.
At turning points such as these, when the time is right, a 'great man' will stand up and many will follow. Who will it be, and what principals and principles will they represent?
Obama was such a one, but he is obviously like the character of Robert the Bruce in the movie
Braveheart, who chooses practically and cynically to support the nobles. He is finished; no one will follow him as his betrayal becomes too painfully obvious.
Will it be the banal fascist with the simplistic, easy answers [bingo], a leftist with retribution to offer, or a real 'braveheart' who has nothing more to offer than the hardship of freedom?"
Jesse, Class Warfare American Style, 5 January 2010
"Monetary and regulatory policy encourage asset bubbles to proliferate.
Hot money seeks out the conscious mispricing of risk. Capital, in the
form of both money and personal talent, increasingly flows into
malinvestment and the gaming of markets.
The productive economy languishes, left wanting for the lack of creative
resources and attention. The bubble rises to unsustainable
valuations— and fails, and a nation's capital is consumed."
Jesse 5 August 2019, The Men Who Sold the World
Stocks continued their declines at a measure, steady selling pace showing little panic.
Surprisingly enough, VIX declined today in spite of the drop in stocks.
The Dollar also fell back a bit.
Gold bounced, while silver fell in sympathy with equities.
That second low in stocks has been set, and nailed on the charts with an iron spike.
Let's see if it takes a panic selloff to make for a viable support level, or if stocks can just start drifting higher and pull the dip buyers, who were spanked sideways this week, back in to buy again.
On May 9th Russia will hold its WW II victory celebration in Moscow. If Putin is going to say something inflammatory about the Ukraine this might be the time that he says or does something that disturbs the global risk factors. Or he might take the opportunity to declare victory and let the 'special military operation' unwind. Much of this depends on Putin's own base of power within his government.
In any case, the danger from exogenous risks remains high, given the unstable underpinnings of the markets.
Have a pleasant weekend.
