"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Friday, August 31, 2012

More Pain for the Middle Class courtesy of Bernanke

Check out the following chart of the Continuous Commodity Index or CCI and note that it has managed to put in a weekly close above the 38.2% Fibonacci Retracement Level of the move lower from its all time recent high made last year. If the market pysche remains the same, look for this index to now make an eventual run back towards the 597-600 level.

We can look at these charts as subjects of interest to us as traders/investors but what this particular stock represents is increasing pain for consumers and the hard-pressed middle class in one of the worst, if not the worst "recovery" since the Great Depression.

Think of this as increased frustration at the grocery store, at the gas pump, at the hardware store, at the local restaurant, etc. While some of this rally is the result of the drought and I will of course not lay that at the feet of the Fed, it is a simple fact that the breakout on this chart today, is the DIRECT RESULT of Mr. Bernanke's insistence on implying that another round of bond buying is on the way.

When you pull into the gas station and fill up your car or truck, and are sent reeling at the cost, you can lay some of the blame right at his feet and the feet of his elitists on the FOMC who insist on pacifying Wall Street instead of having concerns how their policies are destroying Main Street.


  1. No worries about inflation.

    Bernanke's "Gum-Flapping" today as lit a huge fire under U.S. Treasuries.

    That means more fuel for the bonfire and more "Animal Spirits" for the stock traders to jam equities even higher, which will create the "wealth effect" necessary to offset $5.00/gallon gasoline and $6.00 Big Macs.

    Once the CRB Index gets too extended, The Bernank will start screaming and hollering about "managing inflation expectations", threatening margin hikes, and all the rest.

    And the poor commodity future long specs will be shot execution-style.

    At any rate, the gold stocks on on fire today!

  2. Gotta luv it. Still it seems like we don't. Reaay get it yet
    $16 trillion and counting. YELLEN IN THE WINGS. Take a few dollars.. The threat of chaos is on high alert. Do you feel the fire Benny?


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