"Ordinarily, the financial risk in a market, and hence the risk to the economy at large, is limited because the assets traded are finite. There are only so many houses, mortgages, shares of stock, [bars of gold], bushels of corn or barrels of oil in which to invest.

But a synthetic instrument has no real assets. It is simply a bet on the performance of the assets it references. That means the number of synthetic instruments is limitless, and so is the risk they present to the economy. Synthetic structures referencing high-risk mortgages garnered hefty fees for Goldman Sachs and other investment banks.They assumed an ever-larger share of the financial markets, and contributed greatly to the severity of the crisis by magnifying the amount of risk in the system.

Increasingly, synthetics became bets made by people who had no interest in the referenced assets.Synthetics became the chips in a giant casino, one that created no economic growth even when it thrived, and then helped throttle the economy when the casino collapsed." - Carl Levin, US Senator

"We can all agree that AMERICA is now #1. 

We are the ENVY of the WORLD — and the best is yet to come!" - Donald J. Trump

"Anyone who bought stocks in mid-1929 and held onto them saw most of his or her adult life pass by before getting back to even”. - Richard M. Salsman 

Maybe it won't be so bad this time. The Fed does own a printing press, and the rationales for using it freely are becoming increasingly persuasive to those who would deceive and be deceived.

Gold and silver may have found a bottom here, now that the antics of the bank which has been driving prices lower to make good on their short bets are almost done.

The available physical supply at these prices has continued to tighten, especially for gold.

Stocks are soaring to highs. This could be quite impressive, both in the high and in the ferocity of its descent.

From our oasis to yours, have a pleasant weekend. 

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