Friday, January 29, 2021

"Economic Market Snapshot AM 1/29/21"

"Economic Market Snapshot AM 1/29/21"
"Capitalism is the astounding belief that the most wickedest of men will
do the most wickedest of things for the greatest good of everyone."
- John Maynard Keynes
"Down the rabbit hole of psychopathic greed and insanity...
Only the consequences are real - to you!
Your guide:
Updated as available.
Gregory Mannarino, AM 1/29/21:
"Important Updates: 
Full-On Sh!t Show And NOTHING Is What It Seems "
"The more I see of the monied classes, 
the better I understand the guillotine."
- George Bernard Shaw
MarketWatch Market Summary, Live Updates

CNN Market Data:

CNN Fear And Greed Index:
A comprehensive, essential daily read.
Jan 28th to Feb 1st, Updated Daily 
Financial Stress Index
"The OFR Financial Stress Index (OFR FSI) is a daily market-based snapshot of stress in global financial markets. It is constructed from 33 financial market variables, such as yield spreads, valuation measures, and interest rates. The OFR FSI is positive when stress levels are above average, and negative when stress levels are below average. The OFR FSI incorporates five categories of indicators: credit, equity valuation, funding, safe assets and volatility. The FSI shows stress contributions by three regions: United States, other advanced economies, and emerging markets."
Daily Job Cuts

Commentary, highly recommended:
And now, the End Game...
Oh yeah...

Greg Hunter, "Weekly News Wrap-Up 1/29/21"

"Weekly News Wrap-Up 1/29/21"
By Greg Hunter’s USAWatchdog.com

"Both establishment Democrats and RINO Republicans are wanting Trump voters, and this includes many Democrats, to publicly say that Joe Biden won the 2020 Election legitimately, even though the evidence and numbers say otherwise. Why? Is it because the Fraud is so big it will never go away. Is it because the Deep State wants the Biden Administration to be seen as legitimate, even though many think the government is, in fact, illegitimate. Is it because the fraud is so big that Trump will have to be returned to office one way or another? Who knows, but many strange things are going on in our nation’s capitol that we have never seen before. We live in interesting times. That is the only thing you can say for sure.

The Democrats and some Republicans voted to try to impeach President Trump for a second time, and this charge is more bogus than the last. They say his claims about the massive election fraud that happened nationwide with the 2020 Election are false. So far, not a single court, including the U.S. Supreme Court, has heard any evidence. This is a stunning fact, even though more than 40 cases have been filed and rejected. This includes four cases on hold at the U.S. Supreme Court. Again, they have been rejected without hearing one bit of evidence. With the Impeachment in the House and trial in the Senate, President Donald Trump will finally have his day in court. Trump will be able to show evidence of massive voter and election fraud. This impeachment will backfire. Let’s hope the American people will finally see the evidence that their vote and their country have been stolen by the Deep State.

Another 847,000 people filed for unemployment benefits this week. It is a stunning number, and with the Biden Administration, that number is not going to shrink but continue to grow. The economy is sick, and it will be getting sicker with policies of Joe Biden and his puppet masters.”

Join Greg Hunter as he talks about these stories and 
more in the Weekly News Wrap-Up on Rumble here:

"Covid-19 Pandemic Updates 1/29/21"

"Covid-19 Pandemic Updates 1/29/21"
 Jan. 29, 2021 12:10 AM ET: 
The coronavirus pandemic has sickened more than 101,451,600 
people, according to official counts, including 25,805,522 Americans.
Globally at least 2,190,200 have died.

"The COVID Tracking Project"
Every day, our volunteers compile the latest numbers on tests, cases, 
hospitalizations, and patient outcomes from every US state and territory.
https://covidtracking.com/
January 28, 2021 8:05 AM ET
Where I Live:
- CP

Thursday, January 28, 2021

"Is This The Next Big Hedge Fund To Blow Up... And What Happens Next"


"Is This The Next Big Hedge Fund To Blow Up... 
And What Happens Next"
by Epic Economist

"Who would imagine GameStop would be the pivot of one of the most frenetic stock market rallies and spark the blow-up of a major hedge fund? Until last summer, the video game retailer was quietly fading at the brick-and-mortar background and it suddenly saw its stocks sent to astronomical highs as a Reddit group named WallStreetBets started to massively buy them, putting Melvin Capital Management - a hedge fund that shorted GameStop stocks - in big trouble. But, apparently, the hedge fund was only the first to explode and another target is already on the line. That's what we're going to expose in this video.

Not long ago, GameStop was just one of the thousands of retail chains silently decaying as brick-and-mortar operations continue to collapse amid the rise of e-commerce and, of course, the restrictions brought on by the health crisis. Sales have been declining for years, the video game retailer was losing money, and its stocks traded for around $4 a share. But yesterday, GameStop stocks were trading at $339 a share. On Tuesday, they were at $148, and three days earlier, at $38. Which means that shares went up almost ten times in less than a week.

In August 2020, the founder of the online pet store Chewy, Ryan Cohen, sold his business and made a considerable profit. Then, he started buying GameStop shares. Cohen outlined that the company needed to keep up with the modern changes of the digital era, close several branches and make an entrance into the online realm. Several investors followed the move and snapped up the shares of the struggling retailer in hopes of a better future, which tripled their price by the end of November. Conversely, some major hedge funds, most notably Melvin Capital Management, began shorting GameStop, arguing that the idea of a recovery for the video game chain was unrealistic. 

On the other hand, a Reddit group named WallStreetBets recently started to talk about GameStop stocks and buying its shares. But they weren't motivated to do the massive purchases just to make some money, they actually intended to spark chaos amongst investors while bankrupting some hedge funds. Consequently, the share prices of the video game retailer skyrocketed and those who shorted on it like Melvin were forced to cover. Just like that, GameStop has found itself in the middle of one of the greatest stock market bubbles in modern history. 

So after discovering that Melvin Capital was shorting not only some of the biggest day trading darlings but also some of the most shorted names, the fund has become the main target of the violent bull raid of WallStreetBets, but some strategists have been arguing that there most certainly will be other casualties, and it seems that the new candidate for a second hedge fund collapse is Maplelane Capital. 

Taking a quick look at the company's latest 13F, we can see that Maplelane not only has the very same shorts that almost led Melvin Capital to total liquidation, as it has even more puts. In other words, all the troubles Melvin Capital is currently facing might also impact Maplelane very soon. That aggravates the situation even further, considering that with an even deeper book of puts, the Reddit community will now have even more stocks to ramp up in an attempt of forcing a short squeeze either at Maplelane or any other hedge fund that follows the same shorting tendencies as the company.

Overall, it seems like WallStreetBets is indeed behind the market right now. By analyzing some of the industry's favorite longs shows, experts affirmed that they are collapsing while the most shorted names keep soaring. Bubbles like this always end in a crash. In short, this whole situation outlines how the continuous rise in stock prices we have been witnessing since 2009 shows to us how the financial system is completely disconnected with the U.S. economic reality. It's important to highlight that the main enabler to the formation of this new bubble is the Fed. Trillions in printed money injected into the financial markets have created a biblical flood of money with nowhere to go but speculative assets.

Now, the only thing we know it will certainly happen is that, soon enough, this will all end in tears, no matter if stocks go up or down. And as it appears that we will see one hedge fund blow up after the other, and a market crash is looming, a financial disaster might as well arise to spread the destruction caused by the imminent correction all over the economy."

Gerald Celente, “GameStop Proves Markets Rigged To Favor The Bigs”

Gerald Celente, 
“GameStop Proves Markets Rigged To Favor The Bigs”

"The Hyphen..."

"Life is the hyphen between matter and spirit."
- A.W. and J.C. Hare, 
"Guesses at Truth, by Two Brothers," 1827
"Life is eternal. We have stopped for a moment to 
encounter each other, to meet, to love, to share.
This is a precious moment. It is a little parenthesis in eternity." 
- Paulo Coelho, "The Alchemist"

"The Definition Of Hell..."

 

“There Is No Free Market; Robinhood Ripoff; You Can Sell But Not Buy? Stock Market Crazy”

Jeremiah Babe,
“There Is No Free Market; Robinhood Ripoff; 
You Can Sell But Not Buy? Stock Market Crazy”

Neil H, "Candlelight Dreams"

Neil H, "Candlelight Dreams"

"A Look to the Heavens"

“To some, the outline of the open cluster of stars M6 resembles a butterfly. M6, also known as NGC 6405, spans about 20 light-years and lies about 2,000 light years distant. M6 can best be seen in a dark sky with binoculars towards the constellation of Scorpius, coving about as much of the sky as the full moon. 

Like other open clusters, M6 is composed predominantly of young blue stars, although the brightest star is nearly orange. M6 is estimated to be about 100 million years old. Determining the distance to clusters like M6 helps astronomers calibrate the distance scale of the universe.”

Chet Raymo, “The Journey”

“The Journey”
by Chet Raymo

“Here’s a deep-deep sky map of the universe from the March 9, 2006 issue of Nature. The horizontal scale is a 360 view right around the sky; the vertical gaps at 6 hours and 24 hours are the parts of the universe that are blocked to our view by the disk of our own Milky Way Galaxy. The vertical scale – distance from Earth – is logarithmic (10, 100, 1000, etc.) measured in megaparsecs (a parsec equals 3.26 light-years). Across the top is the Big Bang, and the oldest and most distant thing we can see, the cosmic microwave background, the radiation of the Big Bang itself. A few relatively nearby galaxies are designated at the bottom. All that stuff in the middle that looks like smoke or dusty cobwebs are quasars and galaxies from the Sloan Digital Sky Survey.

A smoke of galaxies! (2 trillion galaxies according to latest estimates.- CP) A universe cobwebbed with Milky Ways! Each galaxy itself a smoke of stars, hundreds of billions of stars, many or all of them with planets. My book, “Walking Zero,” is about the human journey from the omphalos of our birth into the world of the galaxies, a journey many of us are disinclined to make. Here is how the Prologue to the book begins:

“Each of us is born at the center of the world. For nine months our physical selves are assembled molecule by molecule, cell by cell, in the dark covert of our mother’s womb. A single fertilized egg cell splits into two. Then four. Eight. Sixteen. Thirty-two. Ultimately, 50 trillion cells or so. At first, our future self is a mere blob of protoplasm. But slowly, ever so slowly, the blob begins to differentiate under the direction of genes. A symmetry axis develops. A head, a tail, a spine. At this point, the embryo might be that of a human, or a chicken, or a marmoset. Limbs form. Digits, with tiny translucent nails. Eyes, with papery lids. Ears pressed like flowers against the head. Clearly now a human. A nose, nostrils. Downy hair. Genitals.

As the physical self develops, so too a mental self takes shape, not yet conscious, not yet self-aware, knitted together as webs of neurons in the brain, encapsulating in some respects the evolutionary experience of our species. Instincts impressed by the genes. The instinct to suck, for example. Already, in the womb, the fetus presses its tiny fist against its mouth in anticipation of the moment when the mouth will be offered the mother’s breast. The child will not have to be taught to suck. Other inborn behaviors will express themselves later. Laughing. Crying. Striking out in anger. Loving.

What, if anything, goes on in the mind of the developing fetus we may never know. But this much seems certain: To the extent that the emerging self has any awareness of its surroundings, its world is coterminous with itself. We are not born with knowledge of the antipodes, the plains of Mars, or the far-flung realm of the galaxies. We are not born with knowledge of Precambrian seas, the supercontinent of Pangea, or the Age of Dinosaurs. We are born into a world scarcely older than ourselves and scarcely larger than ourselves. And we are at its center.

A human life is a journey into the grandeur of a universe that may contain more galaxies than there are cells in the human body, a universe in which the whole of a human lifetime is but a single tick of the cosmic clock. The journey can be disorienting; our first instincts are towards coziness, comfort, our mother’s enclosing arms, her breast. The journey, therefore, requires courage – for each individual, and for our species.

Uniquely of all animals, humans have the capacity to let our minds expand into the space and time of the galaxies. No other creatures can number the cells in their bodies, as we can, or count the stars. No other creatures can imagine the explosive birth of the observable universe 14 billion years ago from an infinitely hot, infinitely small seed of energy. That we choose to make this journey – from the all-sustaining womb into the vertiginous spaces and abyss of time – is the glory of our species, and perhaps our most frightening challenge.”

"Biden Accuses Himself of Dictatorship"

"Biden Accuses Himself of Dictatorship"
by Brian Maher

"We have it on reliable authority - his own - that President Joe Biden is a menace to American democracy... By his own admission... he has exercised dictatorial powers contrary to the prerogatives of his office. Candidate Joe Biden, October 2020: "I have this strange notion. We are a democracy. Some of my Republican friends, and some of my Democratic friends occasionally say‘ well if you can’t get the votes, by executive order you’re going to do something.’ You can’t do it by executive order, unless you’re a dictator. We’re a democracy, we need consensus."

Just so. What actions did President Biden undertake, January 20, 2021, his first day in office? He authored 19 executive orders. By day seven… he authored 37. How many executive orders did Dictator Trump author in his initial week? Four. How many did Mr. Obama author in his first week? Five. Bill Clinton authored one… while fascist George W. Bush authored none. Yet this Thomas Jefferson issued 37 — nearly four times the executive edicts the prior four presidents issued… combined.

A Blow for Liberty? What precisely did the chief executive order?

Did he issue a dictate reauthorizing gold and silver as legal tender - as Article I, Section I, Clause 1 of the United States Constitution specifies?

Did he issue a dictate to shutter the Department of Education or some other bureaucratic atrocity?

Did he issue a dictate to balance the budget? To dismantle the Federal Reserve?

That is, did he strike a blow for the American people?

He did none of it - we have looked through his orders. Perhaps then he ordered a federal holiday in honor of Donald J. Trump? Again, the answer is no. He did not.

“I Decree”: What then did the president mandate? Here is a partial list:

Require masks, physical distancing and other health measures while on federal property…

Direct the acting education secretary to pause federal student loan payments and collections and keep the interest rate at 0%...

Expand protections for federal workers, including putting federal agencies on a path to require a $15 minimum wage for contractors…

Increase the amount of federal spending that goes to American companies and orders an increase in domestic content…

Sets climate change as a key consideration for U.S. national security and foreign policy, establish a National Climate Task Force, pause new oil and natural gas leases on public lands or in offshore waters "to the extent consistent with applicable law," sets the goal of achieving a carbon pollution-free electricity sector by 2035…

Require that all residents of a state be counted in the census, regardless of immigration status…

Halt construction and funding of the border wall…

Revokes the Pentagon's ban on transgender people serving in the military…

Directs Health and Human Services secretary to mitigate "racially discriminatory language in describing the COVID-19 pandemic," among other measures.

We do not here judge the substance of the president’s directives. Perhaps he is doing the devil’s work. Or the angels’ work. But is he doing Mr. Madison’s work? Does the United States Constitution grant the president power to issue these edicts?

Article II of the Constitution: We lift our pocket Constitution from our breast pocket, where it is permanently stationed - near our heart. Thus we are informed Article II limits presidential powers to: Signing or vetoing legislation. Bossing the military and naval forces. Requesting the written opinion of his Cabinet. Convening or adjourning Congress. Granting reprieves and pardons. Receiving ambassadors.

Where does the Constitution authorize the president to mandate wages of federal contractors… suspend oil production on federal lands or offshore waters… to halt construction and funding of a border wall? Is this not the work of the legislature? We concede it - we are incapable of the abstruse and nuanced insights of the legal scholar. The “penumbras and emanations” glowing from the constitutional text are visible to him. They are invisible to us. That is, we are incapable of distinguishing Article I from Article II. We are incapable of distinguishing “shall” from “shall not.” Thus we are disqualified from service upon the Supreme Court of the United States.

Yet, we expect fully the president to issue an executive order impeaching himself for usurping the rightful powers of Congress. For in the president’s words, “We are a democracy. We require consensus.” He indicts himself of dictatorship. You say impeachment is the prerogative of Congress - not the executive. Well, is setting wages the prerogative of the executive? Article, section and clause, please.

A Bipartisan Enterprise: Please understand, we do not mean to isolate President Biden for razzing. Republican and Democratic presidents alike have issued executive orders through United States history. Old Abe Lincoln issued the first official executive order in 1862. Presidents before him mandated hundreds of similar (unnumbered) orders - Washington among them.

Some presidents issued them in such staggering numbers… cries of caesarship came thundering from below. Roosevelt I - Theodore, that is, a Republican - put out no fewer than 1.081. Cousin Franklin Delano dictated 3,728. Of course, Franklin’s arose in response to a national emergency, the Great Depression.

President Biden likewise invokes emergency - climate emergency: "We have already waited too long," Mr. Biden moaned this week. "And we can't wait any longer." Act “we” have. And act we will. There is always an emergency in crying need of remedy.

Congress Cedes Its Powers: But we do not claim Mr. Biden is usurping Congressional powers. Congress has handed them away. Our legal men inform us Congress has delegated 136 statutory powers to the executive branch. Of these, only 13 require additional Congressional say-so. 123 do not. Why should the latest president refuse the offer? Elections - after all - yield consequences. We might hold Congress responsible and the courts that blessed it. Yet we hold no one responsible - and everyone responsible. It was nearly inevitable…

Republic to Empire: The young, vital commercial republic went “not abroad in search of monsters to destroy.” By the late 19th century, it took up the hunt. It has remained on the hunt to this day. At home the federal leviathan has come to regulate every last detail of life. No sparrow falls without its knowledge. Nor does any tree. As befitting an empire, power has concentrated increasingly in the executive authority.

The ancients warned of it; the Founders warned of it. The constitutional Republic’s skeletal structure is intact. It has its three branches of government. It has its separation of powers. It has its decorums and its procedures. Yet look closer. Peer within. The words are the same... but the definitions are not. It is as if Webster has altered their meaning. But the process is so gradual few notice it, as the frog in its pot of gradually warming water fails to notice the heat.

“The Executive Has All the Power He Needs to Do Practically Anything”: Our co-founders Bill Bonner and Addison Wiggin, from “Empire of Debt”: "Institutions have a way of evolving over time - after a few years, they no longer resemble the originals. Early in the twenty-first century, the United States is no more like the America of 1776 than the Vatican under the Borgia popes was like Christianity at the time of the Last Supper, or Microsoft in [2021] is like the company Bill Gates started in his garage.

Still, while the institutions evolve, the ideas and theories about them tend to remain fixed; it is as if people hadn’t noticed. In America, all the restraints, inhibitions, and modesty of the Old Republic have been blown away by the prevailing winds of the new empire. In their place has emerged a vainglorious system of conceit, deceit, debt, and delusion. The United States Constitution is almost exactly the same document with exactly the same words it had when it was written, but the words that used to bind and chaff have been turned into soft elastic.

The government that couldn’t tax, couldn’t spend, and couldn’t regulate, can now do anything it wants. The executive has all the power he needs to do practically anything. Congress goes along, like a simple minded stooge, insisting only that the spoils be spread around. The whole process works so well that a member of Congress has to be found in bed “with a live boy or a dead girl” before he risks losing public office."

The “parchment barrier” of the Constitution could never restrain men determined not to be restrained. As 19th century individualist Lysander Spooner lamented: "Whether the Constitution really be one thing, or another, this much is certain - that it has either authorized such a government as we have had, or has been powerless to prevent it..." Sign away, Mr. President…"

"Anyone Who Isn't Confused..."

"Anyone who isn't confused really doesn't understand the situation."
- Edward R. Murrow

Gregory Mannarino, "Brokerages/Markets - A Crime In Progress For Retail Investors"

Gregory Mannarino,
"Brokerages/Markets - A Crime In Progress For Retail Investors"

The Daily "Near You?"

Karachi, Sindh, Pakistan. Thanks for stopping by!

"There Are Days..."

"There are days, there are times, when you feel like you've walked so far, when the voice inside you is complaining that it's all uphill, that it always will be. And then, after all that, way beyond your blue horizon, you see the biggest mountains you've ever seen, and you think, I can't do that. Well, I hope you always have somebody who tells you that you can. Like I'm telling you now."
- Windy Ariestanty

“Standing Up When It’s Too Late”

“Standing Up When It’s Too Late”
By JR Nyquist

“This article is a comparison between America and another great empire faced with rot in high office and a decline of the state – Rome. The writer, JR Nyquist, artfully points out it’s not the big events that sink an empire but many seemingly little ones. You could call what is happening to the U.S. “death by a thousand cuts.” Except in this story, people are not really aware how deep the cuts are and exactly who is doing the cutting. I loved this piece, and I hope you do as well.” – Greg Hunter
“There is a letter by Marcus Tullius Cicero, dated 18 December 50 B.C. This letter was written to his friend Atticus on the eve of the Roman Civil War. He wrote as follows: “The political situation alarms me deeply, and so far I have found scarcely anybody who is not for giving Caesar what he demands rather than fighting it out.” To explain the situation in brief, G. Julius Caesar had demanded the right to circumvent the Roman constitution, to break laws with impunity, to extend his command over a large army by using that army to threaten the Senate of Rome. “And why should we start standing up to him now?” asked Cicero. The next day he wrote to Atticus: “We should have stood up to him [Caesar] when he was weak, and that would have been easy. Now we have to deal with eleven legions…” Though he hated the idea of civil war, the only course, said Cicero, was to follow “the honest men or whoever may be called such, even if they plunge.”

And who were these “honest men”? “I don’t know of any,” wrote Cicero in the same letter. “There are honest individuals, but there are no honest groups.” Then he asked rhetorically if the Senate was honest, or the tax farmers, or the capitalists. None were frightened of living under an autocracy, he lamented. The capitalists, especially, “never have objected to that, so long as they were left in peace.” But civil war occurred nonetheless, because people are not free to be dishonest forever. They must admit to certain responsibilities, and oppose the advance of evil. The previous inclination to look away, to do nothing, to shrug off responsibility, proves in the end to be no more than a delaying tactic. They attempted to put off calamity, Cicero suggested, and made it all the more calamitous. That is all.

Why did the Roman Senate suddenly stand up to Caesar? What triggered their resistance? As with all free people, they began with policies of procrastination and appeasement. They hoped that the problem (i.e., Caesar) would go away. In the end, however, they discovered their mistake. Everyone still hoped for peace, though none believed it was possible. Everyone wanted to avoid war, but nobody saw a way out. Pompey stood before the Senate and gave voice to what everyone thought. “If we give Caesar the consulship, it will mean the subversion of the constitution.” In other words, it would mean the end of Rome, the end of the republic, the destruction of their country.

In a fitting preface to John Dickinson’s “Death of a Republic,” George L. Haskins wrote, “that the history of Rome is the history of the world, that, as all roads lead to Rome, so all history ends or begins with Rome.” Why do free people fall into complacency? Why are threats ignored until the eleventh hour?

“Surely,” wrote Cicero at the end of Caesar’s dictatorship, “our present sufferings are all too well deserved. For had we not allowed outrages to go unpunished on all sides, it would never have been possible for a single individual to seize tyrannical power.” Caesar’s cause was not right, but evil, Cicero explained. “Mere confiscations of the property of individual citizens were far from enough to satisfy him. Whole provinces and countries succumbed to his onslaught, in one comprehensive universal catastrophe…” As for the city of Rome, Cicero lamented, “nothing is left - only the lifeless walls of houses. And even they look afraid that some further terrifying attack may be imminent. The real Rome is gone forever.”

Republics are slow to defend themselves against enemies that advance, like Caesar, under camouflage. But make no mistake, republics always defend. Groups and categories of men may not be honest or brave, but when they are finally confronted with the truth – as individuals – they see no other course. They stand up and fight. We should not be surprised, therefore, that Caesar was struck down in the Senate and killed by thrusting daggers.

It is all too true, of course. “We should have stood up to him when he was weak,” Cicero lamented. The problem with republican government is its tardiness; or rather, tardiness in the face of danger. As Machiavelli wrote, “The institutions normally used by republics are slow in functioning. No assembly or magistrate can do everything alone. In many cases, they have to consult with one another, and to reconcile their diverse views takes time. Where there is a question of remedying a situation that will not brook delay, such a procedure is dangerous.”

Machiavelli concluded, therefore, “that republics in imminent danger, having no recourse to dictatorship, will always be ruined when some grave misfortune befalls them.” This is the weakness of republican government. Here is the ground on which it dies. An obvious threat, like 9/11 or Pearl Harbor is not the greatest danger. It is the subtle, camouflaged threat, that creeps up from behind. It is this camouflage that gives reluctant men a way out. “We need not fight. We need not make a fuss. There is nothing to fear.”

When this is the prevailing view, people who understand a given threat may ask: “What is to be done?” As long as we are isolated individuals, there is nothing to do. The individual may be honest with himself, but groups are not honest. What prevails overall is an optimistic dismissal. “The threat isn’t real.” This is how Hitler got so far. This is how Communism took over so many countries, and continues today under camouflage. There is nothing the individual can do that will sway the crowd. And as we are a republic, our political system operates according to the psychology of a crowd. The majority are caught up in the fads and media trends of the moment. Cynical and empty publicity characterizes much of our public discourse. But one day the country will awaken. Then, and only then, Americans will stop going along as if nothing serious hangs over them. Will it be too late? Perhaps it will be too late to save the republic. But it will not be too late to save the country.”

"This Is A Choice..."

“To desire and strive to be of some service to the world,
to aim at doing something which shall really increase the
happiness and welfare and virtue of mankind -
this is a choice which is possible for all of us; 
and surely it is a good haven to sail for.”

- Henry Van Dyke

"Let the Games Begin!"

"Let the Games Begin!"
By Bill Bonner

WEST RIVER, MARYLAND – "Today, we turn away from Washington and look to Wall Street for our usual dose of claptrap. And yesterday… in what must be some kind of Bubble Climax… the price of a video game company purveyor, GameStop, traded as high as $370… and then up above $500 in this morning’s pre-market. That’s almost 80 times higher than its price this time last year… and more than 26 times higher than it was at the start of this year.

Every oldtimer on Wall Street knows that you’re supposed to buy low and sell high. But this is no “oldtimers’” market. This is a casino, where gamblers bet against each other… all with chips furnished by the Federal Reserve. What played out in the stock market yesterday was a high-stakes poker game between those betting that GameStop shares would go down – mainly a couple of hedge funds – and those betting that they could force the share price up.

Fake and Foolish: But perhaps readers are in need of some context… as we were. On the banks of the East River, as well as on the banks of the Potomac, almost everything is now fake and foolish. There is no star to steer by… no fixed point of reference… no magnetic North. Fake money has screwed up everything – markets as well as politics.

U.S. stock markets fell yesterday – not enough to make any difference… but enough to make the headlines. MarketWatch has the news: "U.S. stocks book worst daily losses since October as Powell stresses long road to recovery and short squeeze drama plays out.

Stocks closed sharply lower Wednesday, leaving the Dow and S&P 500 index negative for 2021, on mixed earnings reports and after Federal Reserve Chairman Jerome Powell underscored the long road to economic recovery ahead, following the central bank’s first policy meeting of 2021. The Dow Jones Industrial Average skid 633.87 points, or 2.1%, to close at 30,303.17, posting its longest losing streak since Friday, February 28, 2020 when the market fell for seven straight trading days."

Gone Bananas: Dear Readers wisely pay little mind to what is happening on Wall Street. The Street has gone bananas. It’s supposed to discover what stocks are worth. Millions of careful investors with sharp pencils and sharper minds are supposed to tote up expected earnings and discount them to “present value,” based on their calculations of risk and interest rates.

But both pencils and minds have gone dull. By almost every measure you choose – comparing share prices to earnings, sales, book value, GDP, clicks, electricity consumption, the nap on wooly caterpillars… you name it – stocks are overpriced. It’s not hard to see why. Interest rates are phony. And at negative real yields (adjusted for price inflation), any stream of earnings is an Amazon of liquidity and value. So young traders can think anything they want. And tuning into chat rooms such as WallStreetBets, they can make a sport of it.

Like a Rocket: In the case at hand, a pair of hedge funds saw that GameStop was overbought. Headquartered in Grapevine, Texas, it had respectable sales of $5.2 billion in its last full financial year, ending October 31, 2020. But it lost $275 million during that period. A company that loses $275 million per year is not a moneymaker; it’s a money destroyer.

And yet, at its peak, the company was priced as if it had discovered the Holy Grail. Or developed an eternal youth drug. Or inked a contract to sell Donald Trump’s new autobiography, “How I Made America Great Again. LOL!” Of course, it had not. And that’s the point, as Bloomberg’s Matt Levine pointed out. You don’t need to do all that math and research anymore. You just buy a company with a rocket emoji next to its name. The rocket 🚀 is all you need. (The insiders must be selling stocks like crooks unloading stolen money from the getaway car.)

Earlier this year, the hedge funds sold the shares of GameStop short. That is, they sold shares in the company that they didn’t own… betting that the stock would be a lot cheaper when they had to cover their bets. This may be a rocket, they said to themselves, but it is soon going to explode in mid-air and fall to the ground.

YOLO: On the other side were the proto-momo (momentum) players. Every market has its buyers and sellers, its winners and losers. And it’s the momo guys who are setting the pace in this one. The spirit of it was further revealed in a comic video making its way around the World Wide Web. In it, The Joker, played by Joaquin Phoenix, explains to his interviewer host, played by Robert De Niro, that the baby boomers have essentially destroyed the economy.

Millennials have no chance, says The Joker, of ever enjoying the financial success of their parents and grandparents. They might as well take their pittance – from unemployment or stimmy checks – and roll the dice.

In the case of GameStop, the momo delinquents (the “longs”) expected to cash in on the new name recognition and dumb luck. After all, everything goes up, doesn’t it? And there was so much “short interest” on the other side, they saw an opportunity to squeeze the shorts, adding to the excitement, the drama, and the profits. If the longs could bid up the price, the shorts would be forced to “cover” – buy the shares at a higher price… and thus push the price even higher.

As it turned out, they pushed up the price so high – with the help of “short covering” – that the hedge funds had to retire from the field, leaving their horses dead on the field – with 100% losses. Between them, buyers and sellers, GameStop was the most traded stock in the world this week. And it’s all good, pointless fun. YOLO. (You only live once)."
Related:

JAN 28, AT 9:17 AM: "Gamestop Shares Are Collapsing, Pelosi Says 'Will Be Reviewing Issue'" "Raising margins, restricting access, blocking position-building, and widespread condemnation appears to have done the trick... for now."

"Economic Market Snapshot AM 1/28/21"

"Economic Market Snapshot AM 1/28/21"
"Capitalism is the astounding belief that the most wickedest of men will
do the most wickedest of things for the greatest good of everyone."
- John Maynard Keynes
"Down the rabbit hole of psychopathic greed and insanity...
Only the consequences are real - to you!
Your guide:
Gregory Mannarino, AM 1/28/21:
"Twisted! The Economic FREE-FALL Worsens, 
And This Is Bullish For Stocks"
"The more I see of the monied classes, 
the better I understand the guillotine."
- George Bernard Shaw
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"The OFR Financial Stress Index (OFR FSI) is a daily market-based snapshot of stress in global financial markets. It is constructed from 33 financial market variables, such as yield spreads, valuation measures, and interest rates. The OFR FSI is positive when stress levels are above average, and negative when stress levels are below average. The OFR FSI incorporates five categories of indicators: credit, equity valuation, funding, safe assets and volatility. The FSI shows stress contributions by three regions: United States, other advanced economies, and emerging markets."
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And now, the End Game...
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