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Gold Soars

Issue: 9/28/07 Friday

A very important day in the market. Gold has declared that the US Dollar is fairly worthless. Gold reached $750 today, and this should be very disturbing to the central bankers of the world. All the other markets sort of moved sideways.

Consumers shrugged off a rash of bad news to spend more than expected in August while a key measure of inflation eased to the slowest pace in 3 1/2 years. The Commerce Department reported Friday that consumer spending rose by 0.6 percent in August, the best showing in four months and better than the 0.4 percent increase that had been expected. Incomes rose by 0.3 percent last month, slightly lower than had been expected. A closely watched gauge of inflation was up just 1.8 percent in August, compared to the same period a year ago, the smallest increase since a similar rise in February 2004. Consumer spending accounts for two-thirds of total economic activity.

Employment fell by 4,000 payroll jobs in August, the first employment drop in four years. Rising employment is the fuel for further spending, so there is that concern if the labor market weakens then consumer spending could falter in coming months.

So what does today’s news mean?? Well, the consumers in the US are spending a lot, but it isn’t coming from their increased income. Well, where do you think it’s coming from? It only leaves debt. That doesn’t help the future, but it is good news for shops today. There are fewer jobs out there, and that helps explain the decrease in confidence by the average US citizen. The loudest message was the GOLD price. It is just running straight up, and means that people think the US dollar is losing its value (obviously if you consider what it buys in Europe today).

Here are Today’s closing details:

DJ30 – 13,896 (Down 17)10 year US Treasury Bond – 4.59% (Up 0.01%)

US Dollar - $1.4272/Euro. Another new high for the Euro. The market is speaking. Is anyone listening????

Gold closed at $750 per ounce. (Up $10)

Oil Closed at $81.66 (Down 1.22)

Gasoline is $2.04 (Down 0.04)


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This entry was posted on Friday, September 28th, 2007 at 6:17 pm and is filed under US Dollar. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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