Hit Me Again

When the market starts moving up in a straight line, you can be pretty sure that the HFT boyz have decided to lift it one more time. The manipulation has become so routine that it elicits little more than a sigh from the folks, like Nanex, who monitor these things and try in vain to get regulators to at least contain the abuses.

The daily litany of wrist-slap fines tells the tale that pretty much everything is being gamed. Every day, pretty much, captive regulators “discover” that yet another market has been illegally manipulated. They then hasten to relieve the guilty parties of liability with a minor fine before someone with real teeth, like an attorney-general, decides to take an interest and incidentally embarrass the regulators – who knew darn well what was going on, but had been bribed to turn a blind eye to the shenanigans.

January crude futures now sport a $74 handle. There is no mention of the coming deflationary wave, coming primarily from a collapsing Japanese economy and yen. Nothing to do with fracking, by the way, which has been going on for a long time without impact. No, this is Abenomics in action as Japan attempts to export its deflationary spiral to the rest of the world. With some success, I might add, but at the expense of great pain to its domestic economy and people. But what do they matter to the Keynesian believers?

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