The Public Narrative
The great midwestern poet, Kurt Neumann, once said: "Everybody's got a breaking point. And baby, there you are". While not saying that ole Turd is at his personal breaking point, the daily accumulation of lies must certainly be having an impact on all of us.
You're likely a reader of ZeroHedge so maybe you already know this. If not...Did you know that the "market" for S&P futures was twice halted in the wee hours of New York morning today? No? You didn't know that? It wasn't reported on CNBS or Bloomberg? Really?!? That's surprising because you'd think that this would be a pretty important story...especially if your mission is to "inform investors" through "real time financial market coverage".
But I haven't seen coverage of this story at all. Isn't that odd? Here, check it out for yourself: http://www.zerohedge.com/news/2015-09-10/what-happened-612-am-morning
I simply cannot state this more emphatically or often enough...There are no "markets". At least not in the traditional sense in which you're led to believe there are. All you have are HFT computers that swap stocks, bonds, futures and other derivative products back and forth at the speed of light. In doing so, they provide only a bare minimum of market "depth". Therefore, when some or all of these computers line up on the same side of any trade, you get flash crashes and extreme volatility. (As an aside, we've seen similar action in gold for years where a massive seller simply overwhelms the entire market or "bid stack" and price collapses until willing
dupes buyers are finally found.)
Again, THIS IS NOT A MARKET. This is a charade...an illusion, if you will. Designed to look like a functioning market...complete with quotes and Lester Holt giving you the "stocks closed slightly higher today" headline on your 6:00 news. But it's a sham and it's hopelessly broken. I say hopeless because there's no going back. Do you think that the NYSE, the NASDAQ and the CME are going to cut off the revenue stream they get from exacting fees from each and every HFT trade? Hell no! Of course they're not. Besides being completely corrupt, these exchanges are slaves to the almighty profit margin as they endeavor to keep their own share prices afloat in order to fatten executive bonus pools.
So, if the markets are broken and there's no going back, how the heck does this all end? Why can't the Central Banks keep all of the plates spinning indefinitely by daily tinkering with HFT inputs like the VIX and the USDJPY? Hell, I don't know. Maybe they can. This is all unprecedented. The world has never lived through this before. Therefore, we have no historical basis to say "well, the last time the markets were controlled like this, every stock eventually went to zero...or $1000, for that matter". All I can say is that I'm a firm believer in Mother Nature and a sort of Natural Law of Economics.
EVERY Ponzi or Pyramid Scheme finally fails. Water always reaches the lowest point regardless of your efforts to dam it and move it away. Gravity and human nature have a lot in common as they can both be suspended temporarily but not permanently. So, my conclusion is that this entire 6+ year period of bailing wire, rubber bands and unlimited fiat will, one day, come crashing down in breathtaking fashion. In the meantime, we all need to work together to keep our wits about us. This madness will push you to the edge and into the abyss if you let it.
And in case you're wondering if the lies, spin and MOPE are only confined to the "markets", check this next story. You don't even need to go down the rabbit hole of theorizing how and why ISIS came about, just read how the story is now being managed for maximum, intended effect: http://www.thedailybeast.com/articles/2015/09/09/exclusive-50-spies-say-isis-intelligence-was-cooked.html
So, over 50 "intelligence analysts" have complained that their reports have been "manipulated to fit a public narrative." Hmmm. How about that? Does that surprise you at all? And with that in mind, maybe you should look at this. Does anything here look like it's being "manipulated to fit a public narrative"? http://www.zerohedge.com/news/2015-09-10/us-warns-unprecedented-russian-military-buildup-syria-its-starting-look-crimea
"Manipulated to fit a public narrative". Maybe that's a good new tagline for TFMR. Instead of "Preparing For The End of The Great Keynesian Experiment", maybe we should try "Refusing To Be Manipulated By The Public Narrative"? Or perhaps "Standing The Public Narrative On Its Head Since 2010"? How about "Take Your Public Narrative and Shove It Up Your Fat A$$"?
Well, anyway. At least I got that off my chest and, hopefully, gave you something to think about on what would otherwise be just another status quo Thursday. Gold's up 8 bucks, silver is up 10¢ and not much else is happening ahead of the public narrative of the FOMC Fedlines one week from today. In the meantime, have a great day and be sure to check back later to hear a cranky old bastard swear his way through another podcast.