Investers continue the surge toward commodities, with Gold prices going beyond the $1,000 mark for the first time in history; as measured by U.S. dollars. With the dollar continuing to weaken, and signs that the Fed may cut interests rates by another 0.75 percentage points next Tuesday, we'll probably see this trend for some time to come.
As we talked about in the last post, the weakening dollar is also driving up the costs of oil, which is being driven up by investors (rather than supply and demand), as they are exiting the equity markets in huge numbers.
The U.S. dollar dropped to a new low against the euro, going to $1.56, while against the pound it was $2.04.
CEBR economist Richard Snook had this to say about it all: "It may be too late for the US to avoid recession but with prompt action the Fed hopes to ensure that the economy bounces back quickly."
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