'The Brittle Shatters Easily'

Line three of Verse 64 of the Tao Te Ching.

The brittle shatters easily.

The US Stock-Market is not brittle.

It portrays mostly quite false values (of the companies that it quotes), but the structure of the financial markets themselves today are quite unlike what they were early last century.

Gekko's penthouse in
Wall Street II...

Fundamentally, equities' markets are firmly tied to sales taxes and pension funds. And this means there is a constant underlying inflow of cash - natural organic liquidity, in other words - unlike just the pure nominal guarantee of a Federal Reserve Banking system.

The problem with a simplistic central banking 'guarantee' is that there is no compulsion to insert the cash funds at every point. Resulting from that whimsical power (of the Fed, say), political corruption is always rife. Theoretically - and that is how it is taught in academia - the Fed uses economic arguments to making its decisions; but that is meaningless in the ultimate analysis. 

As the history of the falls of Athens and Rome and ancient Persia all revealed, 'economics' is just the after-effect of real world kinetic circumstances and their forces absent of any purely economic criteria. The Goths sacked Rome because they could, not because it had anything to do with trade and manufacturing efficiency and industry.

So when we examine today's relative situation to do with the Crash-like falls in the Dow Jones Industrial Average, we must factor in that there remains a continuous inflow of funds from more-or-less entirely global (meaning the whole rest of the world) pensions contributions and regular superannuation installments -, and now also tariffs. And these funds are seeking some place to go and it is not intended to be 'dollar heaven.' (As in to 'die and go to dollar heaven').

Analysts will be working overtime now to uncover 'hidden' bargains.

You'll have to cancel your trip
to the Florence ladies
boutiques...

That task is well beyond my mind, because I cannot see at all, actual sales and rational earnings flows even anywhere near close to justifying meaningfully-priced capital values.

The idea, for instance, that electric vehicles represent a realistic sales market, is utter nonsense.

What I can see is temporary 'parking' functions via Precious Metals and that is of course, only obvious.

But what we cannot imagine, is an actual systemic financial environment Crash - a actual total breakdown as such. There will be delays in transaction processing, and there will be realized losses and there will be the noise of much complaining going on. 

And there will be some rises in unemployment.

But what there will also be is a clear separation of true value from the fabrication of values that were previously the consequences of universal false accounting by governments and banks and especially, of the inflation statistics, and immense domestic circulation liquidity made from thin air.

And stay away from the Campari bars.
We'll do the Campari bars next article. lol

It's possible that oil prices come down.

Secular disinflation? Unlikely.

I suppose you would have to think that those who can maintain their sense of inward stability while all around them is in great upheaval, will be okay going forward.

For right now the thing to do is let the fires burn and wait till the embers start to glow...