3/7/12…psychopaths and sociopaths

…psychopaths and sociopaths???


Bloomberg Top Stories:


*Stocks Rise as Treasuries Retreat on Increase in U.S. Hiring, Greek Swap – gimme a break!

*Investors Holding 39.3% of Greek Debt Will Participate in Swap, IIF Says

*Finance Chiefs See Pickup in U.S. Hiring as Confidence in Economy Improves – uh huh

*Bernanke Seen Accepting Faster Inflation as Confidence in Economy Improves – oh please!

*Dow Jones Average Record Rebound Proves Best Since Bottom – looking backwards???

*HSBC Plans to Sell Asia, Latin America Insurance Assets for $914 Million

*Goldman Captures Top Spot in M&A Ranking Spurred by Natural Resource Deals

*GE Projects Sales Growth in Latin America Will Outpace Asia’s Through 2016 –China slower?

*Mexican Sinking Food Prices Push CPI Bond Yields to Nine-Month High

*Options Signal Five-Year Yen Rally Ending on Trade Shift  – another wrinkle in recovery?

*Romney Beats Santorum in Ohio Primary as Super Tuesday Signals Long Race

*Panetta Says U.S. Considering Military Action Against Syria ‘If Necessary’

*Romney Racks Up Delegates Even as Campaign Underscores Candidate Weakness

(he outspent all other candidates 4:1, on 45% of Ohio voters felt strong about their choice)


Volume surged to 4.18B shares from 3.28B shares, as stocks tanked gold, and crude all followed suit. Goodbye Dow 13k as Wednesday’s high was the highest it got at 13055.75. NYSE stocks executed on the Big Board rose to 878M vs 703M shares, l about 220M below average. Wednesday’s was the highest of 2012, eclipsing the 1.03B share session on 1/31 (the beginning of the current phase of the rally). Since 11/1 there have been just seven 1B share days…only two in 2012! Since 2/6 there have been four sessions less than 700M shares. 78 of the last 83 sessions have now been less than 1B! Advance/Declines were horribly negative making three straight negatives: -10.4x!!! vs -1.5x vs -1.1x vs +2x vs -2x on NYSE and -4.6x!-1.2x vs -2.5x vs +1.3x vs -3x on Nasdaq. Breadth was even worse: -24x!!! vs -2.4x vs -1.7x vs +2.4x vs -2.7x on NYSE and -6.5x!!! vs -3x! vs -1.6x vs +1.9x vs -3.2x on Nasdaq. New 52 week highs IMPLODED to 55 from 141 while new lose nearly doubled to 91 vs 55.This is the first time in weeks that the ratio has turned NEGATIVE, nearly 2x!!! HEED!!! The S&P VIX gapped up for a second straight session closing at 20.87 +2.82!!! – highest since 2/10. Caution advised!!!

Here are the results of the past five sessions: Dow -1.6x vs -0.1% vs FLAT vs +0.2% vs -0.4%; Transports -1.5% vsw -0.7% vs -1% vs +1.1% vs -0.2%; Dow Utilities -0.4% vs +0.2% vs +0.1% vs +0.4% vs -0.2%; S&P 500 -1.5%!!! vs -0.4% vs -0.3% vs +0.6% vs -0.5%; Nasdaq Composite -1.4% vs -0.9% vs -0.4% vs +0.7% vs -0.7%; Nasdaq 100 -1% vs -1% vs -0.1% vs +0.8% vs -0.4%; Russell 2000 -2.1%!!! vs +0.2% vs -1.6% vs  +0.5% vs -0.4%; NYSE Financials -2.8%!!! vs -0.4% vs -0.5% vs +1.2% vs -0.6%. NYSE Leaders: BAC -3.3%! vs -2%! vs +0.1% vs +1.9% vs -1.6% vs +1% vs +2% vs -1.8%; F -3%; GE -2.3% vs -0.6% vs -0.8%; C -4.6%!!! vs -1.2%!


European equity markets gaining back less than yesterday’s losses, Asia remains weak: FTSE +0.4% vs -1%! vs -0.1% vs -0.2% vs +0.7%; CAC40 +0.7% vs -1.6%! vs -0.1% vs +0.1% vs +0.9%; DAX +0.7% vs -1.5%! vs -0.5% vs -0.1% vs +0.8%; Nikkei -0.6% vs -0.6% vs -0.8% vs +0.7% vs -0.2%; Hang Seng -0.9% vs -2.2% vs -1.4%! vs +0.8% vs -1.4%; Korean KOSPI -0.9% vs -0.8% vs -0.9% vs +0.2% vs closed; Indian Sensex -0.2% vs -1.1% vs -1.6% vs +0.3% vs -1% vs +0.1%. U.S. stock futures higher: DOW +51; SPX +5.60; NDQ +12.50 – about half of what they lost the prior session…dead cat bounce? Bonds modestly weaker: 10’s still below 2%, 30‘s still above 3%: 10 yr 1.96% -5/32. RECORD low 9/23 of 1.6855%; 30 yr 3.09*% -3/8; Long TIP 0.79% flat. 0.57% at high. The 5 yr TIP yields MINUS 1.39%; 10 yr -0.24%. Bills 0.05% 1 month; 0.07% 3 months, 6 months 0.12%. Reverse Repo 0.22%. 3 mo. Libor 0.47%, and 0.74%, stable.

Gold closed at $1672.10 -$31.80…closing below all three averages and raising questions once again, low was $1663.40!!! Tuesday’s $1792.70 intraday high, not seen since 11/16! It is now below even the 200 day ($1676), but has been above $1600 since Jan. 31 It is now $1677.90 +$5.80. The record high is $1923.70, a buying climax on 9/6. Res is $1676, the 200 day, $1690, the 50 day, and now 1676, the 200 day, all rising! Support is $1652, the 1/25/13 low! Crude too was lower, closing at $104.70 -$2.02. It is now $104.84 +.14, with support at the 40 day (101.73), the 50 day (101.54), and major support at $94.77, the 200 day, all rising. Resistance remains at $110.


…are paychos driving business and this country? See below.


TB warned of the false sense of liquidity and complacency and it is all coming home to roost and accelerating by the day. Tuesday was one ugly session…worse, gold and crude were weak. Bonds closed up but gave up most of the day’s gains and 30 year bond remains imbedded above 3%. When are we going to acknowledge that Greece is not going away and the Euro has significant flaws?


Advance/Declines and Breadth turned extremely negative, and for the first time in months, new 52 week lows were higher than new highs (by 2:1!), while the new highs plunged and new lows quadrupled…these are a sign of a lack of liquidity. – and confidence. Futures are higher overnight however. You decide!


. . .   – – –  . . . note that the same old SOS applies…perhaps more so!

Here are the traits of the psychopath and the sociopath (they are very similar but psychopaths have more of a criminal aspect than sociopaths – at least until they are caught, which in this nation of forgiveness for all corporate sinners may not stop them even then).

*Glibness and Superficial Charm

*Manipulative and Conning

*Grandiose Sense of Self

*Pathological Lying

*Lack of Remorse, Shame or Guilt

*Shallow Emotions

*Incapacity to Love

*Need for Stimulation

*Callousness/Lack of Empathy

*Poor Behavioral Controls/Impulsive Nature

*Early Behavior Problems/Juvenile Delinquency – not a necessary requirement these days


*Promiscuous Sexual Behavior/Infidelity

*Lack of Realistic Life Plan/Parasitic Lifestyle

*Criminal OR Entrepreneurial Versatility

(other related qualities(?): contemptuous of those who seek to understand them; does not perceive that anything is wrong with them; authoritarian; secretive; paranoid; only rarely in difficulty with the law but seeks out situations where their tyrannical behavior will be tolerated, condoned or admired; conventional appearance; goal of enslavement of their victim(s); exercises despotic control over every aspect of victim’s life; has an emotional need to justify their crimes and therefore needs their victim’s affirmation(respect, gratitude, love); ultimate goal is the creation of a willing victim; incapable of real human attachment to another; unable to feel remorse or guilt; extreme narcissism and grandiose; may state readily that their goal is to rule the world (or be president?)


Not all of these attributes need be present but score 2 points for true, 1 point for partly true and you can determine one. Today this is referred to as an antisocial personality. It is readily apparent in Wall Street, CEO’s of some large corporations, and politicians. A quick scan of the list will show you just how many people you know or know of fit the definition…perhaps even you do.


If you read Tom Wolfe’s The Bonfire of the Vanities, you saw a true sociopath, in Sherman McCoy. Also, in Bernie Madoff, Tyco’s Dennis Koslowki, Enron’s Jeff Skilling and Ken Lay. But it is not limited to them, and many of some of the attributes but not enough to qualify: Bill Gates, Steve Jobs, in terms of being control freaks. To TB, Fed MacMurray had Captain Queeg wrong in The Caine Mutiny – he wasn’t suffering from paranoia, he was a sociopath!


But it is the misuse of power that stems from this condition that appalls. It explains why so many of those who made it to the top…within the top 1% and especially the top 0.1% (TB would say the Koch brothers), have no empathy for those who are suffering for what they wrought. Furthermore, their greed is endless.


What got TB on this? A WSJ article by Al Lewis on 3/3/12, which discussed an article in the current issue of CFA Magazine (not to be taken lightly), that claims that one of ten in financial services suffer from this malady! Then, because the new issue of CFA isn’t available on the Web, he also read an article by Christopher Bayer, PhD who was mentioned in the article. “Self-interst, power and control are the central lubricants and dominant character features that drive the Financial Psychopath.” This is no joke and explains why Wall Street will stop at nothing from preventing the citizenry to be in control through their elected representatives. How many times do you have to hear it to see that this is a real threat? Bayer has seen many of these psychopaths. You have to think that Lloyd Blankfein falls into this category…recall his puzzled looks when he was caught lying to Congress?


We have to do something and quick to regain control…how many ways do you have to see and hear it before you acknowledge the facts?  Tomorrow TB will examine how the financial services industry fell from grace over the past forty years.


Have a terrific day,



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