Fox And Hens
Stocks jumped up today by 198 points. Have you noticed that over the past few months that the DJ30 Index hasn’t gone anywhere, but it has gone up and down a lot?? Does that make you wonder if it’s worthwhile investing in stocks?
Bonds moved sideways today, and Gold fell just a little
The Dollar strengthened today across the board.
Oil and Gasoline fell significantly today. I will now make another EconomyGuy call. The current market in oil is being driven by speculators – just as it was when it hit $140/barrel. I bet you don’t hear that one on the evening news. However, the speculators are now pushing oil down. When the fox (the SEC) watches the henhouse (the FOREX), the hens (you and me) still get eaten.
In the news today…..
The FED Chief, Ben Bernanke, said that lower oil prices and the higher Dollar would curb inflation, BUT inflation was really uncertain…. What the FED Chief meant was that he isn’t going to raise the Fed Funds Rate anytime in the near future – as I have been predicting for months. He is coming clean with his plan to stick with low interest rates to fight the recession we are stuck in. That’s probably the only thing he can do.
Bernanke went on to say that inflation would moderate in late 2008 and throughout 2009. I interpret this as a “hint” as to when he will be raising rates – sometime in 2009. It might even be later than I thought it would be, i.e. the first quarter of 2009.
Here are Today’s numbers:
Dow Jones 30 Industrial – 11,628 (up 198 points)
10 Year Treasury Bond – 3.87% (up 0.03%)
Euro – $1.4774
Gold – $834 (down $6)
Oil – $114.59 (down $6.59) – a massive run in oil.
Gasoline – $2.87 (down $0.18)