Update 7:30PM EST

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I spend almost no time on conspiracy theories. However, a couple events today made me feel that 1 + 1 = 3 today.

We start the day with horrific economic news. Retails sales fall sharply and the weekly unemployment number comes in higher than any forecasts. The stock market falls over 100 points in the first hour and once again is testing key support around 7900 (I’ve mention this area as key several times recently). Just when it appears we’re going to break support, Tout-TV “reports” the government may be suspending the “mark to market” rule and there will be a big announcement Monday from the Treasury. The “Don’t Worry, Be Happy” crowd did their thing and Tout-TV filled the air with “Happy” people praising this expectation and how well the market is handling bad news today.

So how did 1 + 1 = 3 today? It was publicly announced that the “Working Group on Financial Markets“, better known as the Plunge Protection Team (PPT) met for the first time today under the new administration. After seeing the horrific economic news and believing tomorrow’s unemployment numbers could be real bad, one could envision a sharp sell off today that could have been followed be another one tomorrow. That could have left the stock market teetering going into Monday’s “big” announcement. Hmmm….

Despite poor economic news, the treasury market continued to weaken. As any one asked how all the governments around the world are going to fund all the debt being created for their bail-outs and stimulus packages? Hmmm…

There are two things you can’t keep down these days, a good man and gold. If we can clear $940 on a closing basis, I think we’re off to the races. Gold rises on up days in the U.S. Dollar and falls on days the dollar is down. Hmmm…

Oil - For three straight weeks we’ve had bad supply numbers for oil but it still manages to keep its head above $40. This has to be frustrating for the bears. Next Wednesday’s inventory number should be big as if we continue to build more than expected, oil may not hold. But if we see a drawdown, we could see a rally of $5 to $10 in rather short order.

U.S. Dollar - Sideways despite rising U.S. interest rates. I love the Canadian dollar (its people but not the Vancouver Canucks).

Northern Dynasty Minerals has run up sharply but is very overbought short term. Some profit-taking and consolidation would be healthy.





grandich.agoracom.com