Daily Content
Fleck's Thoughts
Appearances
IndexClose% Change
Dow25490.54-1.11
Dow Transports10171.18-1.57
Dow Utilities807.30.85
S&P 5002822.29-1.19
Nasdaq7628.28-1.58
Nasdaq 1007307.93-1.52
Russel 20001498.44-2.17
VIX Index16.9314.78
10 Year Gov't Yield2.31-3.03
Spot Gold1283.790.82
Spot Silver14.61.04
GDX-Gold Miners20.440.39
Crude Oil58.13-5.36
Dollar Index97.87-0.17
Euro Spot1.120.27
Japanese 10 Year-0.05-14.29
Shanghai SE2852.52-1.36
Long Bond 20-year151.090.92

Market Bends, But Doesn't Break

05-23-2019

Well, the algos must have gotten up on the wrong side of the bed today, because the market was a sea of red through midday (after the SPOOs were lower all last evening), losing over 1% pretty much across the board, although the Nasdaq was a bit worse.

In the afternoon, the market gave up more ground, but a late rally helped it close off the lows. The Nasdaq still lost about 1.5%, however, while the Dow/S&P only lost a little over 1%.

Away from stocks, green paper was weaker, fixed income was aggressively higher, and the metals enjoyed a bit of a bounce, gaining roughly 1%, though the miners barely showed that they still have a pulse. Crude oil is worth noting, as it was crushed for over 5%.

The Rising Price of Ignorance Turning back to the topic of inflation and the epic stupidity of the central banks, yesterday the New York Times business section ran an article headlined, "Who Cares If Inflation Stays Too Low: the Fed Does." I bring this up because, despite all of the chatter and verbiage about inflation not being potent enough for the idiotic central bankers, I have yet to see one thorough discussion about how inflation is measured. I believe if people actually understood the absurdity of the CPI and the Fed's calculations, they would realize that the official measures bear no resemblance to reality.

I suspect at some point we will see that line of thinking opened up, but for now psychology is such that if the Fed says there isn't enough inflation, most people believe them, despite what they are experiencing in their everyday lives.

Lubricating the Gears Might Be Better Just to show how brainwashed the media is and how clueless the central bankers are, I will share one excerpt from the article: "While low inflation might sound great, a never-ending shortfall might hurt the economy. Modest price increases can brighten the economic picture by allowing wages to rise without crushing profits. Janet L. Yellen, the Fed's former chairwoman, often describes inflation as a lubricant on the wheels of the labor market: it keeps wages chugging along."

I can't believe anyone with an ounce of common sense would truly believe that. Obviously, if everyone got the same wage increase, net-net prices would go up by the same amount and no one would get anywhere.

Two Wrongs Don't Make a Right To be sure, Yellen is no longer at the Fed, although she is still a reflect the what passes for thinking there, but James Bullard, the fool at the head of the St. Louis Fed, was also quoted in the article saying, "We're on the wrong side [of inflation], and it's kind of going in the wrong direction."

I am still amazed that this lunacy has lasted as long as it has, but it is what it is. However, we can't be all that far away from where some of this nonsense starts to be debunked by more than just the handful of us who feel this way.