Dollar hits a new low, one Euro =$1.45

The consumer credit report is an indicator of spending by Americans. Consumer spending makes up 70% of gross domestic product, which is the broad measure of U.S. economic activity. People, afraid of unemployment and stuck under high household debt, aren't spending and hold the economy in a slump prevent a quick recovery. Americans reduced their borrowing a sixth consecutive month during July in a bad omen for any easy economic turnaround.

Consumer credit outstanding tumbled $21.6-billion to $2.472 trillion at a seasonally adjusted annual rate of -10.4%, the Federal Reserve said Tuesday. The drop in borrowing was a record.

Wall Street had projected a $3.5 billion not a $21.6-billion decline in consumer credit during July. Borrowing in June already fell $15.5 billion. The last time credit fell six straight months was in the second half of 1991.

The Fed said revolving credit, which includes credit card use, dropped in July by $6.1 billion to $905.6 billion, or down 8.1%. Nonrevolving credit, including automobile and mobile home loans, decreased by 11.7%, or a record $15.4 billion to $1.566 trillion.


Market forces September 9

According to Real Estate Econometrics, the default rate on commercial mortgages held by U.S. banks will rise to 5.4 percent as banks anticipate more losses amid falling rents, LLC.

The greatest market force at the present moment emanates from the suspense of seeing inflation and the collapse of the American dollar. A feeble market over just the next two days would have all our timing indices shouting sell.

A shaky equities market propelled the dollars plunge after a Chinese official said Obama's deficit spending was dangerous and that China was replacing some $Dollar reserves with gold reserves.

Gold is often used as a hedge against inflation. Gold futures broke above the psychological $1,000 an ounce mark, as a sharp decline in the dollar and an oil rally boosted the metal's appeal as a hedge against the depreciating U.S. currency as well as rising inflation. The U.S. dollar to its lowest level.

Crude oil surged more than $3 to above $71 a barrel on dollar weakness and optimism about recovering global demand.

Silver futures recently have outperformed gold, helped by better economic sentiment. Usually less-liquid silver has the characteristics of both precious and industrial metals.


Market Outlook
The Standard & Poor’s 500 Index left the measure valued near the most expensive level in five years.


GE/MSNBC/Pravda admitted that it has a close relationship to the corrupt Obama administration. Yesterday FOX reported that MSNBC employees were told about their dependency on the "GREEN" contracts promised by Obama for MSNBC support over the last year. It confirms that the timing and stock advice of MAD or FAST Money are worthless. Socialism by definition is corruption. When one person steals from another it is a crime. When two people vote to steal from a third person it is called socialism. Under socialism a consensus is all that is needed to commit any crime. Even the US constitutional liberties could be retracted by a socialist majority voting to steal from hard workers to redistribute as patronage payoffs for political support of corrupt socialists. Look at all the ignorant spendthrift Socialists in Congress who started with nothing and became millionaires over night. Even Obama's wife got more than a 100% pay raise when he got in the senate and he became a millionaire in one term.

Asian markets were mixed last night, China up 0.5%, Hong Kong down -1%, Japan down -0.8%, and India up 0.4%.

European markets are currently up in a narrow range from 0.2% to +0.5% this morning about half way through their day.

US market futures are slightly lower by about -0.1% at 7:30 AM EST before the opening today.

GE/MSNBC/Pravda considers Red Chinese stocks to be the leading indicator for the economic recovery in the world. We warned that corruption and fraud could be expected to run rampant with the Communist Chinese socialist experiment unleashing free enterprise. Socialism pays the indolent and incompetent well while heavily taxing the people who create value. A sharp decline is now possible because many leveraged funds are fully invested, have hair-trigger stop sell orders in at about -3%. Our strategy now is to continue to take profits and wait for future buying opportunities.