Trade Deficit
Stocks continued their uptrend today, so this week was a boomer for stocks. Bonds ended down somewhat (higher interest rates), but the Dollar gained almost one cent against the Euro.
Gold lost $5 today – the first loss after an amazing run up in the price of Gold.
Oil and gasoline moved sideways.
In the news today…..
GM sold HUMMER – and guess what they got? Well, it’s being kept private so you really won’t know. However, it is leaked that GM got $150M for Hummer and its dealerships. Is this good, or bad? Well, I’ll let you determine that. In the bankruptcy filing by GM, it was stated that Hummer would bring in $500M. So, that taxpayer takes it in the ear again. Either GM couldn’t negotiate a good deal, or we were lied to in the Bankruptcy documents? It doesn’t matter which – the taxpayer will be paying MORE for the GM bailout.
Trade Deficit – narrowed in August. The deficit was $30.7B. Exports declined (4 months in a row) and imports improved. Here is what’s happening. The “weak Dollar” strategy of the administration (they are liars when they say we have a “strong Dollar” strategy) is making our exports more affordable for the rest of the world to buy. So, we are winning more competitions around the world with our weak Dollar. Good news for exporters. The weak Dollar is also making imports more expensive, so we are buying less imports, as we cut back on all purchases. The Trade Deficit is working narrowing just like it should be narrowing. However, a truly healthy economy would be more “in balance” between imports and exports. So, we’ve got a long way to go. In other words, the FED and Treasury will continue to follow the “weak Dollar” actions. Actions speak louder than policy.
Here are the last numbers for today:
Dow Jones 30 Industrial – 9865 (up 78 points)
10 Year Treasury Bond – 3.38% (up 0.13%)
Euro – $1.4713
Gold – $1050 (down $6)
Oil – $72.29 (up $0.60)
Gasoline – $1.77 (down $0.01)
