"A moment guessed-- then back behind the Fold
Immersed in Darkness,
round the Drama rolled
Which, for the pleasure
He doth Himself contrive, enact, behold.
But if in vain, down on the stubborn floor
Of Earth, and up to Heaven's
You gaze Today, while You
are You-- what of
Tomorrow, when You will be You, no more?
Omar Khayyám, Rubaiyat
Today's Fed statement had a bit of bone in it, but for the most part it was jawbone.
After some initial hesitation and surprise at the paucity of the actual money put
in play by Bernanke, ($40
billion is just walking around money on Wall
Street), the markets shot
higher, seemingly believing that the Fed would do 'whatever it takes' to bring down real unemployment and
to protect the financial markets.
Given that most if not all of the stimulus provided
by the Fed has gone to the top percent of the economy's
participants, I am struggling
with what has changed that will suddenly spread the wealth to the 99
percent. The trickle down theory?
He is monetizing the wrong debt for the wrong people in the wrong ways.
Without reform, Bernanke can print until the dollars come
home to roost, before he will meet
any broad employment targets in this economic structure. Unless the wealthy start hiring people to push their wheelbarrows of money to
The country needs to find
a backbone and act on reform. But like Achilles, it dithers on the beach. For what reasons we may
never know for certain, until
history has its say.
Gold and silver took off higher like scalded
cats. The charts had predicted it but I did not believe it.
Gold has completed a 'cup'
on the daily chart.
Now we would need to see a nice
'handle' to go with it.
There certainly remains
the possibility that the
'cup' could fail, and gold could fall back into its broad trading
range. That would be
manipulation, and it could
continue to work for the time being.
Modern money is a funny little magician that way. I don't
think we have seen anything quite like it,
even in some of the more famous manias.
Bonds are the mother of bubbles.
But momma swings a big stick.
Here is a look at my 'shadow'
chart on gold, that I keep in background to watch developing scenarios without having to engage in unnecessarily
tedious redrawing of the published chart.
The 'rim' looks to be around 1770 to 1790.
If this works, the target for this formation would be 2000+ in the next two months
There are larger patterns forming
on the chart that higher targets.
The situation in silver is
similar, but the percentages
are greater. The targets there would be
roughly 43, and then 60+.
This is by no means a top
One step at a time. In
the event of a liquidity
panic or exogenous event
the charts may defer.