Gold futures soar 2% to trade above $900 an ounce Gold futures surged 2% to trade above $900 an ounce early Thursday, as traders' appetite for commodities was boosted by a recovery in U.S. stocks and rising crude-oil prices. Gold for February delivery rose $18.50, or 2%, at $901.60 an ounce on the New York Mercantile Exchange. "Gold prices are higher on the back of firmer oil price and bargain hunting after the sell-off this week," said analysts at Action Economics. "Bullion was hit by investors selling gold to cover losses from the sale of equities, but with stock markets rebounding gold prices are firming again." "Given the turmoil across the financial markets, it's not surprising to see the precious metals remain extremely volatile as some investors cash in their positions to generate cash while others will look favorably upon gold as a safe-haven asset,"
Gold could go mainstream - and hit four figures In December, the gold price raced off to record highs for the first time in almost three decades. Now it looks to be closing in on $1,000. That is four digits. It will also be four times the 1999 low.The market has added dollars to the gold price for seven consecutive years now, making it the longest-lasting such stretch in history without more than a 25% correction. Even in terms of magnitude, it is the best move since 1979-80. This suggests two things right off the bat. First, it is a bull market; second, the market needs to blow off more upside if it is to give the bears anything more than 25%. John Kaiser of the Kaiser Bottom-Fishing Report believes the market is nearing a flashpoint where the sceptical public finally turn into believers and come rushing in.
Forbes Says U.S. Dollar Policy Amounts to `Zimbabwe Economics' Federal Reserve Chairman Ben S. Bernanke and U.S. Treasury Secretary Henry Paulson are guilty of ``Zimbabwe economics'' by failing to step in to support the dollar, said Forbes Inc.'s Chief Executive Officer Steve Forbes. Neither the Fed nor the Treasury has bought dollars since August 1995 and last stepped into foreign-exchange markets in September 2000 when they sold U.S. currency to buoy the euro. Paulson has said repeatedly the U.S. favors a ``strong dollar'' with its value set in free markets. ``I want to hear that Bernanke and Paulson are going to shore up the dollar,'' Forbes told reporters at the annual meeting of the World Economic Forum in Davos, Switzerland, today. ``Eventually the markets will force them to. If the Fed shored up its value, it would help bring interest rates down.''
Wall Street's recent successes will fade with recession Until now, the big brokerages have been giving us a spoonful of sugar with our medicine. With each massive write-down at earnings time, a chief executive or chief financial officer deftly changes the subject and guides investors to a different part of the income statement. The basic business of Wall Street is in great shape, they say. Brokerages are booming, stock underwriting is rolling, asset management is growing, and merger-and-acquisition advice is selling like earplugs in South Carolina. ey, it was a phenomenal year for Roger Clemens, too, except for that drug-allegation thing. For instance, John Thain, the newly minted chief executive of Merrill Lynch & Co. "to emphasize the fact that the performance of the vast majority of Merrill's businesses were very strong in 2007
Tell Congress how you would spend $800 tax rebate As President Bush and congressional leaders move closer to carving out an economic stimulus package, the debate grows louder over how much of a help it will be to consumers. MarketWatch wants to know what you think. The president has proposed a $145 billion package that would consist of tax rebates and breaks as well as extended unemployment benefits, food-stamp benefits and business-tax relief for investments in new equipment. On Wednesday, the talks circled around including a follow-up stimulus package that would be activated by such downbeat factors as rising unemployment or a bigger slowdown in job growth. There's also a movement afoot for a second stimulus package later in the year that would create jobs for major infrastructure projects throughout the U.S.
N.Y. Regulator Pushes Banks to Rescue Bond Insurers New York regulators are pushing the biggest U.S. financial institutions to rescue bond insurers, led by MBIA Inc. and Ambac Financial Group Inc., and avert credit- rating downgrades that may further disrupt financial markets. Insurance Superintendent Eric Dinallo, who met with industry executives yesterday, is trying to bolster the bond insurers' ratings with help from banks and securities firms that posted $133 billion of writedowns and credit losses tied to mortgage securities. He's received encouragement from Federal Reserve Bank of New York President Timothy Geithner, said a person with knowledge of the matter. The insurers may get fresh capital of as much as $15 billion, the Financial Times said on its Web site yesterday. The figure may be smaller, said a person familiar with the talks. The infusion would help stave off credit rating downgrades of MBIA and Ambac, the industry's two largest companies, and the $2.4 trillion of debt they guarantee.
France's SocGen hit by $7.1 billion alleged fraud Societe Generale has uncovered a massive 4.9 billion-euro ($7.1 billion) fraud linked to a single rogue futures trader, France's second-largest bank said Thursday. The company also said it will post additional write-downs of 2.05 billion euros in the fourth quarter, and it's planning a capital increase on the order of 5.5 billion euros in the next few weeks. The rogue trader, whose role at the bank was to make "plain vanilla" hedges on European stock-market indexes, used his knowledge of the bank's control procedures "to conceal these positions through a scheme of elaborate fictitious transactions," SocGen said in a statement. SocGen said it has begun dismissal proceedings against the trader. His direct supervisor will also leave the group.
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