Author: s4k

A Bull Hates a Rider

If you ever been to a rodeo you know a bull hates riders. Same with investing. Far to many people have gotten bullish on oil. The”dumb” money has built up the largest net long position on record.

At the very least it’s time for oil to take a rest. The oil target was $68. It is time to take more profits. Move your stops up further at the very least.

Autonomy of a Bear

If you shorted bitcoin as indicated here, than you are sitting on some nice profits. Now is the time to lock in those profits. Looking at the chart we see a bear flag formation. This market does not look pretty.

Alexander Gray on Scientific Socialism

Gray wrote with satire and humor. This was very effective. From the book “The Socialist Tradition, From Moses To Lenin”:

To witness BohmBawerk or Mr. Joseph carving up Marx is but a pedestrian pleasure; for these are but pedestrian writers, who are so pedestrian as to clutch at the plain meaning of words, not realizing that what Marx really’ meant has no necessary connection with what Marx undeniably said. To witness Marx surrounded by his friends is, however, a joy of an entirely different order. For it is fairly clear that none of them really knows what Marx really meant; they are even in considerable doubt as to what he was talking about; there are hints that Marx himself did not know what he was doing. In particular, there is no one to tell us what Marx thought he meant by , ‘value.’ And indeed, what all these conjectures reveal is somewhat astounding, and, one would like to think, unique. Capital is, in one sense, a three-volume treatise, expounding a theory of value and its manifold applications. Yet Marx never condescends to say what he means by ‘value,’ which accordingly is what anyone cares to make it as he follows the unfolding scroll from 1867 to 1894. Nor does anyone know to what world all this applies. Is it to the world in which Marx wrote? Or to an abstract, ‘ pure,’ capitalist world existing ideally in the imagination, and nowhere else? Or (odd as the suggestion may appear) was Marx(probably unconsciously) thinking in terms of medieval conditions? No one knows. Are we concerned with Wissenschaft, slogans, myths, or incantations? Marx, it has been said, was a prophet-albeit a prophet whose ambitions lay in another direction-and perhaps this suggestion provides the best approach. One does not apply to Jeremiah and Ezekiel the tests to which less inspired men are subjected. Perhaps the mistake the world and most of the critics have made is just that they have not sufficiently regarded Marx as a prophet-a man above logic, uttering cryptic and incomprehensible words, which every man may interpret as he chooses.

The most obvious difficulty of the Materialist Conception of History, at least in its less guarded statements, is seen in its helplessness when confronted with the problem of mind, and of the influence of mind on mind. Doubtless great men are conditioned by their environment, but they are certainly not produced by their environment; we all reflect our times. It is easy enough to persuade ourselves that any of the leaders of humanity could have appeared only when he did appear.
It is absurd to assume that any great man was bound to appear at the appropriate juncture. When he was old enough to know better, Engels, in a letter of January 25, 1894, more or less champions this extraordinary view. That Napoleon, ‘just that particular Corsican,’ appeared and did what he did, was an accident, but if just that particular Corsican had failed to turn up, ‘ another would have filled the place’-apparently with equal efficiency. ‘The man has always been found- as soon as he became necessary.’ Presumably the man is also found as soon as he is unnecessary, of whom there are many at large in the world in these latter days. Engels can hardly have thought of the curious theological implications of the view that we all have somewhere our deputy ready to do our work when we are put out of action. It is indeed by no means overwhelmingly obvious that if Hegel and Marx had died in their infancy, the Hegelian philosophy would’ have been produced by someone called Schmidt to give a flavour to the three volumes of Capital, written by some one called Meyer :on the whole, the chances are against it.

Crypto Fraud

A crypto exchange has gone down. Read the full story here. Users can not access their accounts. They can not pull money out. They do not have any real answers. Users of crypto currencies think they are safe from fraud. From the article:

The short history of cryptocurrencies has been rife with hackers and stolen bitcoin, so issues with exchanges are quick to unnerve investors. In the most famous case, Mt. Gox filed for bankruptcy in 2014 after losing hundreds of thousands of its clients bitcoins.
Kraken is one of the exchanges that the CME Group Inc. is using to price the bitcoin futures it introduced last month.
Lack of communication from fledgling companies, delays in withdrawals and transfers, high fees, and the creeping fear of a malicious attack are some of the issues largely retail investors face, and discourage many more from jumping in.
With not even a phone number or e-mail listed on Kraken’s status page, the exchange’s clients vented on Twitter.

I suspect this problem goes way beyond one exchange. At the top their is always fraud and stupidity. You don’t have a realized profit in any crypto currency until your money is back in your bank account.

Natural Gas Did Not Go to Zero

Natural gas update.
As predicated, natural gas did not go to zero.

It is approaching major resistance though. This is the time you take some profits. Valentines day is coming up. Get your spouse something nice with this hard earned money.

USD Trade Update

Update on the USD trade. Take some profits. Move the rest of your stops up to lock in a profit. If you have only one open position the trade has completed.
Looking at the long term chart the dollar just made a weekly closing not seen in almost 3 years.

Not much technical support until 85. The USD is looking weak at the moment.

On African Immigration

Tyler Cowen has an excellent article posted about African immigration. I have not done the research to confirm this is true or not but my personnel experiences would suggest he is correct. In college and in my master program, African immigrants were always the top performers. Cowen writes:

One of the most striking facts about immigration to the U.S., unbeknownst even to many immigration advocates, is the superior education of Africans coming to this country. If we consider adults age 25 or older, born in Africa and living in the U.S., 41.7 of them have a bachelor’s degree or more, according to 2009 data. For contrast, the native-born population has a bachelor’s degree or more at the much lower rate of only 28.1 percent in these estimates, and foreign-born adults as a whole have a college degree at the rate of 26.8 percent, both well below the African rate.
How about high school degrees? About one-third of immigrants overall lack this credential, but only 11.7 percent of African-born migrants don’t have a high school degree. That’s remarkably close to the rate for native-born Americans, estimated at 11.4 percent.

26 Billion Dollars

Well, 25.9 billion to be exact. That is the amount of money the fed pays on excess reserves to banks. I made a short comment on excess reserves here. The full release is below:

The Federal Reserve Board on Wednesday announced preliminary results indicating that the Reserve Banks provided for payments of approximately $80.2 billion of their estimated 2017 net income to the U.S. Treasury. The 2017 audited Reserve Bank financial statements are expected to be published in March and may include adjustments to these preliminary unaudited results.
The Federal Reserve Banks’ 2017 estimated net income of $80.7 billion represents a decrease of $11.7 billion from 2016, primarily attributable to an increase of $13.8 billion in interest expense associated with reserve balances held by depository institutions that was partially offset by an increase of $2.5 billion in interest income on securities acquired through open market operations. Net income for 2017 was derived primarily from $113.6 billion in interest income on securities acquired through open market operations (U.S. Treasury securities, federal agency and government-sponsored enterprise (GSE) mortgage-backed securities (MBS), and GSE debt securities) and foreign currency gains of $1.9 billion that result from the daily revaluation of foreign currency denominated investments at current exchange rates. The Federal Reserve Banks had interest expense of $25.9 billion primarily associated with reserve balances held by depository institutions, and incurred interest expense of $3.4 billion on securities sold under agreement to repurchase.
Operating expenses of the Reserve Banks, net of amounts reimbursed by the U.S. Treasury and other entities for services the Reserve Banks provided as fiscal agents, totaled $4.1 billion in 2017. In addition, the Reserve Banks were assessed $724 million for the costs related to producing, issuing, and retiring currency, $740 million for Board expenditures, and $573 million to fund the operations of the Consumer Financial Protection Bureau. Additional earnings were derived from income from services of $442 million. Statutory dividends totaled $784 million in 2017.