The Week Ending Friday
July 12th 2008 00:17
The USD appears to be breaking down, again, set to challenge the low near 71 (see chart)
Crude oil closed the day at $145.08, up $3.43 per barrel, just short of its all-time high close.
Indymac's (IMB) assets were seized!.
Yesterday, I wrote "It still looks like yields could collapse! The 2-year, 10-year and 30-year are all back below the 200 dma." Today with the DJIA tanking and the S & P taking out the 2006 low, interest rates confounded us by rising. Bill Murphy at Le Metropole Cafe writes that this means "The US Government is hitting the wall with its ability to move interest rates down as inflation continues to rise, on a day when the market is brutalized." The rise may mean nothing more than a move back to the 200 dma before going lower.
The Commerce Dept reported the trade deficit of -$59.8 Billion for May, 2008 was about equal to May of 2007, surprising some who were looking for -$62 Billion. The real news in the report was
For the 12 months ended in June, overall import prices rose 20.5 percent, also the largest gain on record. But the increases were not just driven by higher oil import prices, as non-fuel imports also saw a record increase during the 12-month period.
Ambrose Evans-Pritchard writes
The money supply data from the US, Britain, and now Europe, has begun to flash warning signals of a potential crunch. Monetarists are increasingly worried that the entire economic system of the North Atlantic could tip into debt deflation over the next two years if the authorities misjudge the risk.
Bernanke is such a student of the depression, but he may end up making exactly the same mistake, shrinking money growth and strangling the economy.
| 53 |
| Vote |
