We are waiting patiently to see whether the “financial clotting system” will work in coming weeks, since the recent market action (to the upside) has been accompanied by record low volume for the year.
Being a “sick puppy” by nature, I am always searching for creative and useful anologies in order to help me understand what’s going on, so this morning, I thunk (sic) that we’d all go on rounds with Dr. Ure, as he diagnoses the patient which is having some financial circulatory issues presently.
Up until this week, it was looking like the patient would recover nicely and go on to new record highs. BP (bond purchases) were normal and so forth.
However, overnight (as he pulls back the covers of the patient) we notice some bleeding in the extremities.
As a resident stock surgeon, you will please flip over here to some classifications of hemorrhages, so we can be on the same page. A Class I hemorrhage is minimal loss, although 15% of blood volume is higher than what either of us would consider “minimal.”
Yet this morning, the markets are minimally hemorrhaging.
Let’s inspect the extremities:
Japan was down 4/10th’s of a percent.
But Hong Kong was down 1.2%. We will keep a close eye on that since the military is ascending in China over the civil government, and one way to fix a broken economy is to pick a fight. If that happens, watch BP (bond pressure) closely.
Our next extremities to review are victims of the train wreck in Europe called the ECB and negative rates.
The Brexit-Brits are down 1.5%, the French were down 1.9%, but the most serious bleeding has been by the Germans, who are into a class II financial blood-loss, down 2.13%. (Did we ever give them their gold back?)
Of critical importance is that the Germans have fallen this week well under the psychologically important 10,000 on the DAX, which is one of our more useful EU vital signs.
The US meantime, was looking to lose about 100 Dow points at the open, so we can begin to pencil up a diagnosis that goes something like this:
We will administer firm talk to the markets today, and parade synchophants on the talking-head circuit over the weekend. Monday, the patient may continue down into the close of about Tuesday or so.
Then, when the US Fed announces next week that rates will not yet be raised, the patient should make a miraculous recovery.
At its sickest, we will remove our short bandage and flip to a long dressing, after waiting for the impulsive first twitch following the Fed announcement and then we will buy in the short correction that usually follows.
As always, this diagnosis is only our best estimate of what should happen. Doctors never issue guarantees, warranties, or free service plans for life.
Economists should consider similar restrictions on their practice. Congress should be sued for malpractice.
We can move on to watching the vital signs monitor when will show the pulse beginning at 9:30 AM Eastern.
The UK Daily Mail headlines this morning at “White House calls FBI probe into Clinton’s classified emails a ‘criminal investigation’ – to glee of Republicans – on the same day Obama endorses her.”
Bernie Sanders oughta be having a mimosa for breakfast on this one.
Where is the Other News?
On hiatus. A Hiatus is located 2-inches beyond your reach. This is why you don’t get one.
A minor consumer sentiment dealy and the Baker-Hughes rig count is about all the excitement we can muster to move the monitors in the financial trauma ward. Just as well, I suppose.
The balance of what’s pawned off as “news” includes Mohamed Ali still being dead. And in the
Washington Amazon Post we see how they are still writing about how to Dump Trump at the convention.
But the REAL news of the day is that there is a Kim Kardashian look-alike. Since this article came out of the UK, we have to wonder if Kim Kardashian stories will be a major distraction ahead of the June 23 the Brexit vote?
Where to Hide?
Since I will be chatting later today with the publisher of the highly-esteemed Buffalo Gap News, I have to warn him that the Urbanites are coming. This is based on the Wall St. Journal report about the Land Rush *for the rich* out in the Hill Country of central Texas.
I’ll also ask how many of those Buffalo gals really come out at night. And whether he’s interested in joining my Association of Upstart Media, pronounced AUUUMMMMMM. *(rimshot)
Guest Commentary: Friday in the Police State / War On Cash
Oilman2 is on the mend from hip replacement and trying to make it through the latest wringing out down in Oil Parch South (Houston). Here lately, he’s become very sensitive to the government/PowersThatBe War on Cash that we’ve covered more on the Peoplenomics.com site than here…
Where we are today with cash….
I have a few thousand dollars in savings. I have a mortgage, another on some land. I own 2 cars and have another financed. That’s my ‘net worth’, excluding the silver, copper, tungsten and a bit of gold I have rounded up in the last 15 years.
From speaking to my friends, I am not atypical. The largest portion of my monthly income goes to mortgage and property taxes. At this point, one mortgage payment is $650, and the property taxes on this mortgage are $715 per month. The other mortgage is $395, with property taxes of $$100 per month.
In order to pay down the smaller mortgage principal, I wanted to take $10,000 put of savings. I asked for cash, and was informed it would be 5 working days for my multinational bank to produce this amount of $100 bills. Five days later, I was informed that bank policy required me to inform them what I was purchasing, and that if it was a physical item, they were restricted to offering me a cashiers check only. I had the cashiers check made out to my daughter. She took it into the issuing bank, whereupon they refused to cash it, but offered her a checking/debit account instead as their only option.
With savings accounts paying .2% interest and checking account service charges now at $10/month or more – the only true service the bank is offering me is a place to put my money and use a debit card against my own cash.
At this point, I am withdrawing all my cash out of the bank in $1000 increments. I vary the amount by a hundred dollars or so, as the teller informed me that repeated withdrawals of the same amount in cash were recorded due to federal banking regulations.
Last month, one of my business friends was pulled over in Oklahoma for speeding. Small town (pop 450) and the speed limit was posted as 55MPH then reduced to 25MPH in a 100 foot distance. Yes, local speed trap. My friend refused to allow the local LEO to search his vehicle. The local LEO refused to return his drivers license and proof of insurance, and within 10 minutes the state guys showed up with a K-9 unit.
The rousted my friend and his wife from the car, removed all their luggage and searched it on the side of the road. They removed spare tire, door panels and anything else they could pry off the vehicle easily. They found nothing, but than handcuffed my friend and wife, removed his wallet and took her purse. They found $700 in cash, which they confiscated as “drug money”, indicating that their “drug dog” had indicated drugs, and that was the reason for their search.
They were never charged with anything, never arrested – but their car was taken apart and their cash confiscated. I don’t know about anyone else here, but “highwaymen” used to pull over travelers at gunpoint or swordpoint and take their money. What is the difference between “highwaymen” and Law Enforcement based on the above incident? Nothing – absolutely nothing.
They then removed handcuffs, issued a speeding ticket and left my friend and his wife with an undriveable vehicle and all their possessions scattered along the ditch next to the highway. They informed him that he could appeal the confiscation of his “drug money” at the county courthouse. The ticket had an appearance date 14 days from the date of their trip.
Then I read the following article: http://www.news9.com/story/32168555/ohp-uses-new-device-to-seize-money-used-during-the-commission-of-a-crime
Here is this company: http://www.officer.com/company/12189987/erad-electronic-recovery-and-access-to-data
So, we have the IRS, which enforces taxation based on political necessity and has code so complex they do not understand it themselves, deep into our pockets. We have state and county governments charging more for property taxes than the mortgage payments of the home (see mine above) and no way to opt out. We have banks that will not allow you to remove your own money without jumping through myriad hoops and reporting every large transaction to some regulating agency with no oversight. And finally, we now have Law Enforcement agencies that are fully finctioning and legally sanctioned highway robbers, even down to mapping your credit card purchases and assuming whatever purpose they can imagine, in order to confiscate your cash, jewelry and vehicles.
There is no way to travel across the country without running the same risk as was present during the post-civil war period – robbery. The difference today is that this robbery is government sanctioned and abetted.
Banks now offer you a place to put your cash, but not a way to withdraw it except in purchases sanctioned by the bank or in smallish amounts. It requires me to schedule small withdrawals weeks in advance if I want to buy a used vehicle and pay in cash. The truth of the matter is that using a bank is a losing proposition – even the convenience factor has been removed. By putting your money in any bank, you support these onerous regulations and their never-ending fee structures, which they enforce by disallowing you access to your own cash – instead you must get a cashiers check, which they will not cash at their own bank counter.
I don’t know where this is heading, what other draconian means they will invent to keep our money in their pockets. I do know that I am getting my money out of banks – they offer you more risk than a mattress stuffed with cash, because you cannot get your money out and they constantly take their ‘pound of flesh’. I know that I do not take any trip with more than a few hundred dollars in my pocket. Consequently, I am taking far fewer trips and spending far less money – because the risk of being legally robbed is constantly rising.
The only way I can see to change any of this is to simply stop – to opt out of a system designed to separate you from your hard earned money at every turn. I don’t know where this will lead me, but I am determined to get out of this nasty nest of non-working and non-productive middlemen. And honestly, I think it is the middlemen and bureaucrats that we feed that are the problem. Pick your industry – every one is rife with regulators, enforcers, requirements and managers who produce NOTHING – but they all make their living off of those of us who work and produce.
I talked to some friends in Oklahoma about this: The reason that the law is in place is because people of Oklahoma are genuinely sick of all the drugs and troubles they bring, so it seemed like a reasonable solution.
However, as one told me, the surest way from being ripped off by police tapping into your bank accounts with your ATM card being scanned is to simply keep minimal money there.
On the surface, this might works, but there are issues with it. For example, if you have a large sum of money and it is in a brokerage account (as an example) then you would likely never get it back in the event of a major cyber gang attack or EMP event.
But going to cash is no good, either. That’s because police can get a warrant on any pretext they want and then come raid your home, and in most places, but most especially in :rebel flag” country, even a couple of thousand dollars would be confiscated as “suspect” – even if you have the bank receipts showing legal and lawful withdrawals.
Then there is the matter of bank reporting. Elaine and I will be going on vacation in July – up to Seattle to see the kids (when the eyes have recovered, so we hope) and in our usual trips plans I always include enough cash to buy gas for the return trip to Texas. It’s not much – 2000 miles at 26 MPG highway means a mere 77 gallons, but should there be a genuine crisis, that would likely bring on price gouging instantly – and I’m hoping $10 a gallon would be enough.
Now, in my world $750 is not a huge sum of money, but it is enough to pay close attention to. By the time I put in for tips and miscellaneous cash deals (I am already tired of crooks double-scanning my credit card, done that dance, thanks) I am very much inclined to pay for things with legal tender.
Except: The way event-chains have linked up, whether accidentally, or on purpose, the FRN bills that say “Legal tender for all debts, public and private” is an outright lie: If you have more than $2,000 to $3,000 in cash – even it you have it for a lawful purpose – you can have his hijacked by LEO’s of the highwaymen stripe and there you are.
A check with my consigliore finds that the average wrongful confiscation of cash recovery action will cost $20,000, six months, and even then the outcome is uncertain. In the event that you are not a “local” and well known in a community, and happen to drive with out of state plates, well, you’re at higher risk.
People who are innocently traveling in America shouldn’t be subject to highwaymen masquerading at police. But civil asset forfeiture is the newest way for government to steal money far beyond the lawful purposes provided for by duly-elected representatives of the people.
A Reader Notes
It looks like my SSL cert for the Peoplenomics site didn’t get renewed…so I will have that figured up today. Five to six hours for that, I figure and one more thing on the to-do list.
Great article in PN tomorrow on the coming collapse of shopping malls…you won’t want to miss it.