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Economic Commentary From Sott.net


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Every week the alternative news site www.sott.net produces economic commentary of a bearish outlook for the global economy. The current edition discusses the housing bubble in the US and its implications: http://66.90.73.49/articles/show/144405-Si...6-November-2007

Summary: Gold and oil rose again and the dollar fell last week continuing trends that were interrupted last week in a classic short-lived "correction." Right now with real estate and the dollar no one really knows where the bottom is, and with gold and oil, no one knows where the top is. One analyst even predicted a 90% drop in the value of the dollar.

How many times do we have to read that "we've never been in this situation before," or "we are going to see economic times the likes of which no living person has seen," before we get the picture?

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  • 1 month later...

This weeks commentary in full: http://www.sott.net/articles/show/147186-S...14-January-2007

Summary: Gold continued to shoot up in price last week, ending just below $900 an ounce. Oil, however, dropped sharply, due to concerns about economic recession (which lowers demand for energy). The evidence for recession in 2008 continued to mount this week with the release of bad holiday sales figures for the major U.S. retailers. The once strong Countrywide mortgage company was bought by Bank of America and Citigroup got another infusion of cash from a Saudi prince and China. Recession fears also pushed U.S. stocks sharply down at the end of the week.

Last week we continued a look into the reasons why capitalism makes everyone, poor and rich, so miserable. This week, we delve into the inner workings of capitalism to give a better idea of how and why the economy reached its current dismal state.

The edition last week can be found here: http://www.sott.net/articles/show/146786-S...-7-January-2008

Summary: Stocks continued to plummet in the United States last week. The NASDAQ in particular, dropped almost 7%. The latest official unemployment numbers came out and, even with all the undercounting they do, it rose to 5%, spooking the media into finally acknowledging the recession.

This week, we look at selfish capitalism, the Post-Bush regime, and a new War of Terror that is most certainly tied to the current economic chaos.

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This weeks commentary after a volatile week: http://www.sott.net/articles/show/147537-S...21-January-2007

Summary: The continued fall in the stock market has frightened the general public and the insiders, it seems. Hardly anyone now says there won't be a recession. Predicting recession seems to be a bullish position now, with the bears predicting a depression or even a collapse.

Last week we looked at how capitalism works and how, by doing what it does, it ruins everything. What can we do about it? Marxism has been an indispensable tool for understanding capitalism, but historically has not been able to offer any solutions. Why is that so? If the diagnosis was so good why wasn't the cure of revolutionary socialism effective?

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http://www.sott.net/articles/show/147923-S...28-January-2008

This week Donald Hunt discusses why we all felt that sick feeling in the pit of our stomach. We know this is coming, yet when it comes it scares the begeebusses out of us:

"Summary: The stock market rose a bit last week. Ho hum, right? Of course that statement conceals the roller coaster that was last week, with stocks falling sharply the first half, then recovering the second half of the week. The drops in global stock markets in the beginning of the week (the beginning of the year, really) were so sharp that many of us, even those who had been predicting this for years, had that sick feeling in the pit of our stomach. How bad would it get? Recession, depression, or complete collapse? We still don't know, but given the underlying situation, the collapse side of the equation seems more likely than a simple recession (two consecutive quarters of negative growth)."
Edited by cybervigilantes
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This week's summary from Signs Economic Commentary for 4 February 2008:

Summary: Last week little doubt remained that the United States is in recession with the news that the number of jobs fell. If all we are facing is a recession then we will be very lucky. Chances are much worse is in store: either depression or collapse. Why? For one thing, the U.S. dollar, the world's reserve currency is in risk of collapse because to prevent banks from failing the Federal Reserve Board is rapidly lowering interest rates; but that, in turn, makes dollars worth less on the international currency market.
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This weeks economic commentary from sott.net

Summary: Gold and oil shot up again last week, with both rising about 3 percent against the dollar. Against the euro, gold and oil only rose about a half percent. Fed Chair Ben Bernanke is keeping the banks afloat by sinking the dollar. We're only two months into 2008 and what a year it's shaping up to be! The Dow is down about 1100 points for the year - close to ten percent - and gold is up about 16 percent. or more than 130 dollars an ounce. The bad trends seem to be accelerating and at some point we will reach the point of no return. The negative effects of the housing crash have only started to be felt and no one knows how long central bankers can keep the banks from failing. The housing crisis in the United States is accelerating. In one startling sign, there are states where foreclosures outnumber housing sales.

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This weeks economic commentary from sott.net

Summary: The big news last week was the fall in stock prices following the announcement of sharp drop in jobs in February in the United States.

So here we are now where many of us have been predicting we would be. No one should be surprised. The only surprise is that it has taken this long. All one needed was common sense to see what was coming.

Timing, however, is a different matter. Investors and speculators always want to know the timetable. Therefore there is a lot of room for manipulation when it comes to the timing.

So, what's next?

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This weeks economic commentary from sott.net

Summary: Looking back on last week, it is safe to say that the Fed's odd rescue of Bear Stearns was a success. The price of gold fell the most it has in any week since 1990, almost 9%. The dollar gained on the euro. Oil was down 8%. The Dow rose 3.4%. Not to say there isn't a whole lot to criticize in the Bear Stearns action. Don Harrold does a great job of that here if you haven't seen it yet. But it did what it was supposed to do: stop the bleeding.
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This weeks economic commentary from sott.net

Summary: World economic leaders, meeting in the G7 ministerial level gathering last week, expressed concern about the possibility that a rapid fall in the value of major currencies like the dollar and pound sterling could lead to economic collapse.

The rapid rise in food and fuel costs is causing concern in developed countries and riots in poor countries.

What did the top economic member of the Bush administration say? What else - food price controls on food in poor countries would be a bad idea. U.S. Treasury Secretary Paulson saw economic danger in helping millions of people avoid starvation and ruin. And that leads us directly to the root cause of all of this...

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This weeks economic commentary from sott.net

Summary: Oil and food topped this week's economic news. In the case of oil, all the saber-rattling over Iran doesn't make much sense. But then, neither does spending trillions of dollars on the invasion and occupation of Iraq - at least from an economic standpoint.

As for food, riots abound as Asian rice producers have been curtailing exports so as not to infuriate their own populations who are facing real difficulty from higher rice and other food prices. The curtailed exports lead to even higher prices, which increases the pressure on other countries to cut exports. The rise in the price of food and energy in the United States is leading to a political crisis there as well, which could lead to the uprising against the globalizing elite and the corporations...

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