DJIA

open 11,133.40

close 11,164.05 up 31.49

day high11,247.60

day low11,132.34

today's volume 168,112,548

3mo avg. daily volume 183,770,565

DJTA

open 4,756.98

close 4,774.86 up 19.89

day high 4,823.98

day low 4,756.98

today's volume 15,610,649

3mo avg. daily volume 15,975,203

 

Apologies to the faithful, it has been extraordinarily busy for the past two weeks and being that I'm more of someone who journal's progress than writes professionally, I have put the blog on the shelf from time to time.  The markets have been very interesting.  I find it amazing that this much manipulating can occur in a single market.  I talk to a lot of interesting people in a given day, most of them focused primarily on their finances, at least throughout the duration of our conversations.  There is confusion... and hope.  Some have lost it, but some cling.  I've always enjoyed the story of Pandora's Box, when all the horrors have been unleashed, at the bottom of the box is hope... I've always wondered if that is meant to show a rebirth of things, or if hope itself is the greatest and most potent horror that exists.

Geithner asked international central bankers to minimize their holdings in US Dollars.  Potentially flooding the market with "used" issues of US Dollars.  This would cause a drastic decline in the value of the currency, at least short term.   I can't put 2 and 2 together on this one.  I can think of a few reasons why, but none of which give me any insight into how they plan on "fixing" this problem.  I don't know if they do plan on fixing it.  In fact, I'm quite sure they have no intention of doing so.  Instead, stretch the problem out long enough until it becomes someone else's problem.

If you're a farmer, I hope you've had a great harvest.  Where commodity prices have risen too, my corn growers throughout the midwest are enjoying replenishing their coffers.  But food prices at the first tier of production are always lower than food prices at the last tier of consumption, and I wouldn't be surprised to see inflationary pressures make their way to market throughout the next 6 months.

DJIA

open 11,105.24

close 11,146.57 up 38.60

day high 11,213.54

day low 11,066.19

today's volume 178,063,555

3mo avg. daily volume 185,639,033

DJTA

open 4,749.99

close 4,749.38 down 13.81

day high 4,769.99

day low4,685.05

today's volume 23,253,755

3mo avg. daily volume 16,095.898

 

A lot of aggressive nothing this past week in the markets.  Most of the noise made as a reaction to China increasing rates 0.25%.  Gold finally shows some signs of slowing and in three days has blown off $55.00 an ounce, and hopefully more to go.  Still not too excited until I see how markets hold out for elections.  No QE 2.0 appearing quite yet.  However, where's the necessity with the DJIA above 11,000. 

DJIA

open 11,022.82

close 11,096.08 up 75.68

day high 11,155.23

day low11,022.07

today's volume 224,916,510

3mo avg. daily volume 184,552,965

DJTA

open 4,611.40

close 4,731.44 up 120.04

day high 4,767.93

day low 4,612.46

today's volume 20.026.206

3mo avg. daily volume 16,403,660

DJIA

open 11,006.93

close 11,010.34 up 3.86

day high 11,030.50

day low 10,977.90

today's volume 114,830,029

3mo avg. daily volume 185,186,544

DJTA

open 4,628.84

close 4,630.74 up 2.35

day high 4,563.37

day low 4,618.13

today's volume 11,936,849

3mo avg. daily volume 16,593,467

DJIA

open 10,968.41

close 10,948.58 down 19.07

day high 10,998.53

day low10,892.76

today's volume 141,822,141

3mo avg. daily volume 185,699,525

DJTA

open 4,584.19

close 4,576.64 down 6.93

day high 4,597.09

day low 4,540.60

today's volume 14,975,502

3mo avg. daily volume 16,637,880

Unfortunately, no apologies to offer as I've had a nice week off from writing.  Was out of town over the weekend and although it wasn't my intent, I've just been remiss for no reason except a little breathing room.  Over the last 5 trading days we've moved up just over 160 points, 193 just on Tuesday, and the first increase in volume I've seen in a long time.  Comparing the rises in the dow to the decreases in the dollar is interesting, see charts below.

When the Dow is up 10% but the dollar is down about 7 1/2, then what is your effective net return?  It took the fed roughly $10 Billion a week for the past two months to get us here.  Do I call this a recovery?  What do you think?

Inflationary upward pressure does not speak recovery.  Unemployment, GDP and housing figures speak louder than stock markets do, and those do not whisper recovery either.  The Fed will increase inflation rates and both quantity and velocity of monetization, they will eventually increase interest rates, and because of this prices will inevitably rise... your income however, will not. 

Bernanke spoke out yesterday.  CLICK HERE  It's fun to watch someone bury themselves from the feet up in their own rhetoric.  At least he's enough of an academician to understand that proving your hypothesis wrong is just as valid as proving it right.  Kudos to my old friend Alex, the physicist, who always explained to me that within the field of science, and hopefully all academic ventures, being wrong and being correct are equally important, as being wrong brings you a step closer.  Unfortunately however, where my friend Alex is exploring the properties of bucky balls, Bernanke is playing at the wallets, families, futures and heart strings of real people trying to make real ends meet.  What is unfortunate is that Bernanke will admit that what they have tried hasn't worked, but still believes it hasn't worked because they haven't done enough.  Enough?  When I was in elementary school, which is only back in the late 80's, we didn't know what came after the word "million."  We used to throw around the word zillion as a joke.  It wasn't until 2008 that people used the word "trillion" in monetary conversation.  They literally invented a new kind of money, which is thousands of multiples of what originally existed to prove their point... and that apparently isn't enough.  

This devotion is held in the hearts of the Fed Board of Directors with the same fervor as the debate of science versus religion, or democrat versus republican, neither side with any intention of listening to the other, let alone conceding any ground, and inevitably handicapping both arguments and ultimately human progress.  I'm not saying that Keynesians are intrinsically wrong and Austrian's are intrinsically right (although I do believe John Maynard Keynes is not someone I would have shared a sense of morality with) ... or better yet, I should use the word "practically" instead of "intrinsically" since there is no practical perfection that we humans can attain (ie. "the utopian society" argument... it just doesn't exist, or matter).  But I am saying that the battle rages, and like most battles there are hero's and villains on both sides.  

With that said I stand an Austrian.  It may not be able to fix every problem, but it also wont ever make them far, far worse.  And I believe that the "in a utopian society" Keynesian economic models, like most humanitarian ventures which are done with the best of intentions, are often left in the hands of tyrants.  And the Federal Reserve Bank's job is to sell US Dollars, not stabilize the US Economy.  I don't care how many ways you slice the pie... they own the pie.