If it wasn't for the attack the US Treasury yields would continue their rise on weak demand. The Federal Reserve loves foreign conflict recently. Without it, Treasury yields would be sending out alarm bells as would their lack of demand. Fog of war is good for banks as long as the zirp policy, market plunge control policy is in effect, and there is little fallout in QE constraint and promises of more should the economy show weakness (which is why bad news is still good sometimes ergo more plunge control). Those financials closest to the Federal Reserve are just about the only ones who love this economy, and for a good reason, they are the only ones able to buy whatever they want at a discount. In fact, they own more of America today than in recent history and if they end up with housing, they are the only ones able to hold it without registering a loss thanks to accounting rules which before would amount to fraud.

I'm impressed. So many "chartist" rambles are seldom worth reading and detrimental to follow. This analysis of option behavior is good analysis and worth considering since sophisticated option traders take this to mind to evaluate their market positions. The lack of understanding of options these days by the general public places them in such a disadvantageous position professional traders to equate their differences to that of algae compared to humans. It is rather sad and is why increasingly there are less individual traders. However, as they mass together, much like fishermen develop nets to catch their prey in mass, the concerted effort to move these lemmings into poor mutual fund, ETF, and other baskets to feast on many consistently and amplify their ignorance is defining the market as a very manipulated one with the government further unbalancing the cart by promising a litany of false promises inviting even more algae to the pond before its cleaning.

Thanks for your reply. Indeed, I agree this is predominantly the case with fiat money. Prior to it, there have been marked times when there was a lack of inflationary pressure or deflation ruled the roost. Indeed monetary expansion inevitably pushes the cart forwards and the lack of adequate goods and services to meet it generates inflation. How many people fall off it as it tilts depends on the excess of the people pushing the cart too hard.

1) Free trade has kept inflation low and kept America growing for decades now. In addition most of our trading partners gobbled up our debt keeping the consequences of our government's policy of massive overspending from hitting us. 2) Mexico and Canada and NAFTA are not the main issue and revoking it will not change anything. It would just increase prices and shift more production to China, Vietnam, and other places in the world. America's competitiveness issues extends far beyond NAFTA. 3) NAFTA is good and without it Mexico would be more hostile and more poor and we would have even more illegal immigrants trying to pour into America. NAFTA isn't the cause of illegal immigration. In fact, it is a attempt to mitigate it. 4) It is easy to blame others, but the simple fact the thing that is killing America is internal. America's drive towards increased government to solve everything, monetary expansionism by the central bank, massive deficit spending, excessive taxation, and government involvement in the private sector from Fannie and Freddie in housing to nationalized TBTF banks is the reason America is growing as slow as molasses and losing its competitive edge. The farther we decline towards socialism the worse it will get. Unfortunately, socialism always has a cure for the discontent. Unfounded and misdirected national fervor pointing fingers at everyone but the culprit for its demise, itself. North Korea is a good example. I hope people turn away from this asap before America gets lulled to far into this anti-capitalistic self imposed morass.

I think tracking gold to see the effect of oversupply in the monetary base is not a good measure, primarily because it is so easily manipulated by the same agents responsible for monetary expansion. In general, its better to look at the whole inflation picture including volatile aspects the governments like to discount. Even then, an argument these reports are still undervaluing inflation is certainly credible and worth consideration. The simple fact is those connected to the central bank and government sweet have gotten much richer while the average American has gotten poorer. This is not a coincidence, it is a direct result of socialism and crony capitalism destroying the free market and despoiling America's growth engine.

There is very little choice to put money in the global market and with Europe imploding it is natural assets will flee to the US. It is not a statement about US resilience as a statement that the global economy as a whole is in danger and the US seems the most stable even though its massively overbought. I don't see this changing save the end of this year or beginning of the next. There is too many spooky things in other markets to make people worried about the false bubble that is being generated in the US. If anything, it is a reassurance at this point of time. The only thing is that as all manipulated markets, that assurance will lead to overvaluation and then uncontrolled collapse. So far people seem somewhat aware of this but are happy that it's not going to happen tomorrow. But what about tomorrow? That's a different story.

I agree Europe will be in crisis again, but it's wrong to conclude it's Russia. Europe has solved very little from the previous crisis and, like the US, has only delayed the effects which will inevitably make things worse. If the rot has spread all the way to Germany, then it is pretty serious.

I do not see Tesla in the same light. The founder is famous for making bats with taxpayer money and Tesla is not alone in that. Also he is seeking high speed transportation grants from the government to make another taxpayer led bet. This is fundamentally due to 3 things. First, Tesla's price puts its capitalization astoundingly high and even it's CEO has stated his doubts about its price. Second, Tesla broke ties with the government loans due to their inability to keep to the sustainability requirements set out in them. Which leads me to the third concern: In order for Tesla to stay viable they need to invest heavily in battery plants using their outdated battery technology. Given the speed of technology change and the fact massive battery plants will take decades to depreciate, betting on Tesla today is essentially as risky bet as before it made headlines with its cars. You may win, but don't expect massive appreciation anytime soon. In the meantime, competition is on its way. As for arguments that electric cars are new and novel, please look at your history. Electric cars were around decades ago. Technology is what makes them viable versus gas powered cars, and technology is advancing rapidly. Tesla must spend its profit keeping up with the curve because the car majors are coming in. Technology will make or break Tesla. It is way too early to tell its long term success. My guess is it will eventually hit the skids and be bought up by a major car company, but certainly not at the current market prices that set Tesla as expensive as other car companies with pitiful revenue and profitability compared to their rivals.

Agreed even though Mexico produces a lot of silver. The odds of a country going back to the gold standard is low and silver is even lower given the fact it is used increasingly for productive measures rather than a store of value. That said, given the rarity of silver and its uses, it is a great long term investment, especially given the rate of depletion of silver only mines. Eventually, all there will be is silver gained through copper and gold mining. That said short term volatility is ridiculous given the games played by paper silver which far exceeds silver inventories.