House of Representatives Vote on The Bailout Bill Make The Markets Jittery

Where People Put Their Money When Uncertainty Is King

Date 03/10/2008

The Right Side

Ben Traynor

Uncertainty is king today.

The House of Representatives votes on the bailout tonight. The markets have already got jitters over that — the Dow closed down 348 points last night. Disappointing US economic data also added to the pressure. (As an aside, I saw the Dow news first on the big Bloomberg screen by Waterloo station. Sadly there was no sound — all I could do was watch the see of red and curse the fact that I’m unable to lip read).

Meanwhile, Eurobailout’s in trouble. French President Sarkozy wants to put together a €300 billion rescue package. But developments have overtaken him. First the Irish and now the Greeks have announced they’ll guarantee all deposits with their major banks.

The moves have complicated the picture considerably. Funds are flowing into the countries offering the guarantees... while the European Commission is investigating whether or not it’s even legal to make such guarantees.

All the confusion has been bad news for the euro, which has been sold heavily.

Where’s the money going? Into the dollar, weirdly, despite the US government preparing to buy a whole truckload of septic securities. I suspect, longer term, that flow will reverse itself... more on that in future FSDs.

The yen has also risen — unsurprising given its image as a ‘stability currency’. The FT also reports this morning that gold dealers have been inundated. Some are reporting levels of business not seen since 1980. Several have run out of bullion.

Now, maybe that should ring alarm bells. That was, after all, the year gold peaked, before entering a two-decade downtrend. But, in my opinion, a little gold is well worth having. As I said above, uncertainty is king right now.

That’s why we’re putting together a special report on gold. You see, many commentators, myself included, have been putting forward the case for why you should buy gold. This new report will be all about how.

I’m hoping to have that ready for you within the next week. Stay tuned...

Iran needs nuclear because it’s running out of oil

"The nuclear renaissance is under way," says Garry White, our commodities expert.

Garry could talk for hours on nuclear power. Which countries are building how many reactors. How long they’ll take to build, how much uranium they’ll use when they’re operational.

And, if I’m honest, it’s pretty boring, technical stuff.

"Where’s the investment angle?" I always ask. Luckily, Garry’s got that covered too.

Today, let’s have a look at Iran. Don’t let that spook you — that’s not where Garry’s investing.

No, we’re looking at Iran because it’s a great example of why Garry sees a nuclear boom just around the corner.

There are others too... and it’s not just a power-generation issue.

Find out more — including how you could make money by riding this trend...

Until next time

Ben Traynor

Editor

Fleet Street Daily

The Daily Reckoning — An irony-induced coma

Word on the street is that the pols are about finished Christmas treeing the bailout bill. The House of Representatives prepares to cast its historic vote today.

Here at the Daily Reckoning...we stand back...aghast...agog...paralyzed by the whole spectacle... from the lunatic assumptions of the credit bubble...to the solemn farce now taking place in the US Congress.

Yes, dear reader, we are suffering from senselessness overload...the absurdities are coming too fast for us now; we can’t keep up. We fear we are going into a irony-induced coma.

Could any scriptwriter have come up with such a preposterous story? Could any director have found such a clownish caste of characters?

You can read the Daily Reckoning in full here.

P.S. If you enjoyed this article you can find out more about our free email, The Right Side by clicking here.

^ Back to top

LinkedIn
Twitter
Del.icio.us
Digg
Facebook
Google Bookmarks
Livejournal
StumbleUpon