Trading Theme returns…  Automakers’ bailout vote today…  Not using all your arrows…  Housing Starts go back to 1959! And Now… Today’s Pfennig!

OK… Whew! What an awful day yesterday for the currencies… In the morning, they ere in rally mode with the euro gaining ground to well within the 1.27 handle. But then the Trading Theme set in, and those gains were wiped out. The Trading Theme was set off by the awful Housing data, which reminded everyone of the deep, dark , dangerous days ahead… I bought some euros, and watched them rise, and went off to do something else… When I returned, they had fallen… UGH! The Japanese yen, however, rallied, as is the case with the Trading Theme… Risk trades get unwound, which benefits dollars, and yen. I’ve explained all this before, so I won’t get into it again, but there’s someone that has gone into the problems

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Apparently its not just the US, the Middle East, and Europe Scrambling for gold, but also China, according to a recent article in the Shanghai Daily.

Investors going for gold as a safe haven

By Zhang Fengming  |   2008-11-20  |     NEWSPAPER EDITION

DEMAND for gold in China rose 18 percent in the third quarter as consumers turned to the precious metal as a safe haven for their cash, the World Gold Council said yesterday.

Demand rose to 109 tons in the third quarter, the majority of which is attributed to a strong rise in the Chinese mainland, the council said yesterday, citing figures complied by researchers GFMS Ltd.

Demand from the mainland rose 20 percent to 99.8 tons. In Hong Kong it increased 7 percent to 3.8 tons while demand in Taiwan shrank by 6 percent to 5.4 tons.

China’s gold jewelry demand grew 9 percent to 92.5 tons in the quarter as sharply lower prices

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In a recent interview with Financial Times, mega-investor Jim Rogers had some interesting comments about the fate of the US Dollar.

He sure doesnt mince words.

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Insight: The dollar is a flawed currency

By Jim Rogers

Published: November 17 2008 16:05 | Last updated: November 17 2008 16:05

The following are excerpts from this week’s View from the Markets online interview

FT: It’s a year since we last interviewed you. You were aggressively bearish about the dollar, but you thought there would probably be a rebound and you would take that as an opportunity to further get out of the dollar. Have you made a further exit from the dollar?

JR: Not yet, no. And the reason I haven’t is because we’re in a period of forced liquidation of everything. We’ve only had eight or nine periods like this in the past 150 years, where everybody has to reverse their positions on everything. There is a gigantic

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Never forget that the media in China is controlled by the Communist Party. That means that you should pay careful attention to the official state news because it usually paints an accurate picture of things to come. The latest news story is that the Chinese central bank is 'considering' increasing their gold reserve from the current 600 tons to 4,000 tons, a whopping 700% increase. The gold market is really quite small so that type of volume buying could have a big impact on gold prices.

China’s President Hu Jintao just concluded on a victorious trip Havana on Tuesday - expanding a trade pact that could divert commodities from open spot markets.

It’s no secret that China has largely been responsible for the commodity run-up of the past few years. Now the question remains if the latest deal with Cuba could give China a new lost-cost provider of commodities. If so, it could be a bit of bad news for investors looking for a China-driven commodities run-up.

On Tuesday, Chinese president arrived in Cuba as part of a Latin American tour to strengthen ties with the resource-rich region. And his timing was impeccable.

Just weeks after Cuba’s farm sector and overall economy were rocked by three hurricanes which inflicted more than $10 billion, China parachuted in with almost a dozen trade agreements, according to Cuba’s state-run news agency.

In exchange for wider access to Cuba’s natural resources, China will rehabilitate

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Deflationary forces are pushing the price of gold lower. However, beyond the short-term price for paper gold, some of the news is surprisingly bullish. I'm putting out an update to my recent gold report today, with some very interesting news on supply and demand. The director of the World Gold Council was on CNBC yesterday talking about it. You can see that video here: http://www.cnbc.com/id/15840232?video=933064521 Some of the bullish news for gold ... * Global demand rose 18% to 1,133.4 metric tonnes from 963.3 tonnes a year earlier.* In dollar terms, the jump in demand was even bigger. Dollar demand for gold reached an all time quarterly record of $32 billion in the third quarter, a whopping 45% higher than the previous record … set in the second quarter.* Identifiable investment, which includes purchases through exchange-traded funds and of bars ...

By Senior Writer Eoin Gleeson Nov 19, 2008 Eoin Gleeson Jim Rogers

Rogers: buy commodities and China

If there’s one man who hasn’t been swept off his feet by the prospect of Barack Obama in the White House, it’s Jim Rogers. “Barack Obama has two policies to speak of,” he told attendants at the World Money Show in Westminster. First, he wants to tax capital, just when capital is at its weakest. And second, he wants to protect American jobs. Both ideas are absolutely disastrous, reckons Rogers.

You only have to look at the experience of Japan. The Japanese were determined to protect and prop up their faltering businesses in the nineties, but all it did was leave them with a load of zombie banks. All that happens when you tax capital to prop up failing businesses is that you take money from the competent and give it to the incompetent, says Rogers.

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Zhongpin Inc. (HOGS) saw revenues soar 116% to a new record in the third quarter as the company continues to expand pork production. HOGS has surprised on estimates 3 out of the last 4 quarters on average of 7.25%. The company is cheap. HOGS is trading at only 5.7x forward earnings.

Company Description

Zhongpin is a Chinese-based meat and food processing company that handles pork and pork products as well as fruits and vegetables. The company operates in 24 provinces in China through over 2,960 retail outlets and also exports to the European Union, Eastern Europe, Russia, Hong Kong, Japan and South Korea.

Zhongpin has been expanding production. On Nov 7, it announced that its new prepared meat facility in the Henan Province, which was just starting production, would increase annual production capacity for meat products, including sausage and ham, by 114%.

The new facility was built

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Our outlook for the machinery sector is increasingly one of caution. We are beginning to see U.S economic weakness and the credit crunch negatively impact international markets.

Japan's machine orders have fallen for two consecutive months, with a huge 14.5% decline in August. China Petroleum & Chemical Corp., or Sinopec (SNP) plans to cut its oil imports for the fourth quarter of 2008, which portends of slower manufacturing activity ahead.

As foreign economies deal with weaker exports to the U.S and Europe, industrial customers are cutting back on capital spending. Equipment orders are decelerating in almost every end market -- from machines used in construction, infrastructure, agriculture and base metal projects.

Over the next 6-12 months, we believe the biggest potential problem area is global construction spending. Investors should realize the conditions that created the U.S. housing crisis existed in various markets outside the U.S. Excess liquidity and easy money played

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NYT: A Sea of Unwanted Imports November 19, 2008

By MATT RICHTEL NYTimes

LONG BEACH, Calif. — Gleaming new Mercedes cars roll one by one out of a huge container ship here and onto a pier. Ordinarily the cars would be loaded on trucks within hours, destined for dealerships around the country. But these are not ordinary times.

For now, the port itself is the destination. Unwelcome by dealers and buyers, thousands of cars worth tens of millions of dollars are being warehoused on increasingly crowded port property.

And for the first time, Mercedes-Benz, Toyota, and Nissan have each asked to lease space from the port for these orphan vehicles. They are turning dozens of acres of the nation’s second-largest container port into a parking lot, creating a vivid picture of a paralyzed auto business and an economy in peril.

“This is one way to look at the economy,” Art Wong, a spokesman for the

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