Inflation
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Drop in Consumer Spending Could Spell Trouble for Economic Recovery
U.S. consumers curtailed spending in September for the first time in five months the government reported on Friday. Combined with a weak report on consumer sentiment, it increased fears the economic recovery could falter as government stimulus spending winds down, sending the stock market into a downward spiral.
The news sent the Dow Jones Industrial Average plummeting by 294.85 points, or 2.51%, on Friday to close at 9,712.73. Meanwhile, the Standard & Poor's 500 Index fell by 29.93 points, or 2.81%, to close at 1,036.18 and the Nasdaq Composite Index plunged 52.44 points, or 2.5% to close at 2,045.11.
The Commerce Department said purchases fell by 0.5%, after gaining 1.4% in August, matching the median estimate of economists surveyed by Bloomberg News. But consumers continued to increase their savings even as their incomes dropped.[mm_legacy_signup_code]The Reuters/University of Michigan's consumer sentiment index rose to 70.6 in late October, up from 69.4 earlier in the month. However, that's still down from September's reading of 73.5. -
Why the Dollar's Rebound Will Be Short-Lived
The dollar yesterday (Thursday) rallied from 14-month low against the euro, but that rally will be short-lived as U.S. monetary policy is likely to remain loose, even as other central banks raise interest rates. A recovery of investor risk appetite has slammed the dollar in recent months, driving the currency to a rate of $1.5017 [...]
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Gold Prices Soar to 18-Month High on Dollar Weakness, Inflation Fears
Gold bugs pushed the gold prices to an18-month high today (Wednesday), as rattled investors focused on renewed weakness in the U.S. dollar and the looming potential for runaway inflation. Those factors combined to push gold as high as $1,023.30 an ounce, the loftiest level since late March 2008. The case for inflation was bolstered by [...]
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Buy, Sell or Hold: The SPDR Gold Trust ETF (NYSE: GLD) Continues to Offer Investors a Hedge Against Inflation
The just-concluded Group 20 (G20) meeting left us with a chorus of very "prudent" governments and central bankers singing the praises of easy monetary and fiscal conditions. So where can we take refuge when all the central banks in the world print money and governments run deficits in order to spend like drunken sailors? The [...]
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China Exports Drop, but Production Rises on Domestic Demand
August exports in China plummeted 23.4% from a year earlier as the global economic crisis continued to take its toll on developed countries. However, industrial production in the Red Dragon still managed to grow, indicating the best is yet to come for the world's third largest economy. Boosted by a $586 billion (4 trillion yuan) [...]
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Three Ways to Profit as Inflationary Fears Push Gold Over the $1,000 Mark
[Editor's Note: This look at gold prices is the first in a series of Money Morning quarterly reports that will examine such topics as housing, U.S. stocks and oil. These reports will now be a regular feature at the end of each quarter.] By Mike Caggeso Associate Editor Money Morning Gold surged a solid 4.3% [...]
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Inflation Gently Rises in February, Offering Analysts a Sign the Economy Isn’t Collapsing
By Mike Caggeso Associate Editor Money Morning The consumer price index (CPI) moved 0.4% in February, a little higher than expected and a sign that consumers are dipping their feet back into the water – slowly. More importantly, while the data isn't a gigantic leap forward, it's at least not another deathblow to the economy. [...]
