First, the good news: From June 2007 through September 2008 (i.e., during the credit crisis) Income CEF payouts per share were virtually unchanged. From June 2008 through September 2008, payouts rose slightly— 29 funds raised their payouts and 17 lowered them. Your portfolio spending money should be higher than it was a year ago.

Brokerage firm monthly statements are designed to promote either fear or greed, depending on the current market environment. Nowhere on your statement can you find numbers that report your net investment, your total working capital, or your true asset allocation. Current and projected income numbers are given little attention, and monthly withdrawals are treated like losses of principal.

Income portfolios are reported upon using the same format as growth portfolios, and too much analysis is required to determine if the income production is either safe or adequate …

The news is saturated with Hank Paulson’s $700 bailout plan. This is diverting attention away from the increasingly bleak outlook for the wider economy.

Rick Pendergraft says no bailout can immediately solve the problems in the housing market. And all indicators suggest these will run well into 2009 at least.

Rick says your portfolio should be all about playing safe for now. He recommends eight inverse ETF plays to hedge against this downside risk.

This from Investor’s Daily Edge:

I can understand the fixation on the bailout, but other economic reports are getting lost as a result.

Last Thursday was a day that the mass distraction was working to its full capabilities. Investors chose to ignore all economic data in order to focus on the progress of Congress.

In case you missed it, durable goods orders for August were down 4.5 percent from July (I guess the stimulus checks ran out), initial jobless claims jumped to …

Ben Bernanke and Hank Paulson are planning the biggest bailout of financial markets in history. It could cost the taxpayer somewhere in the region of $1 trillion. But the market will triumph over the interventionists, says Bill Bonner.

The biggest credit bubble in history is due a correction, and there is little the Fed or Treasury can do to stop it. The more they try, the more money they have to print.

This makes the outlook for the dollar and US Treasury bonds ever more perilous… and the outlook for gold ever more attractive.

This from The Daily Reckoning:

There’s a war going on…a battle between a natural market correction…and an artificial attempt to avoid it. On the one hand, Mr. Market wants to correct the excesses of the boom/bubble period that began in 1982. On the other, Misters Bernanke and Paulson want to prevent him. Mr. Market takes down asset prices. Mr. Market …

The ugly truth can sometimes yield beautiful profits, says Irwin Greenstein, writing for Contrarian Profits. But the truth exposed by the US government’s recent round of Wall Street bailouts is that the US actually lost the Cold War in terms of its free-market philosophy. Investors should adjust their portfolios accordingly…

For a while now I’ve been writing that if you can integrate a historic shift into your investment strategy you may come out ahead. The shift is this: that America actually did lose the Cold War.

This became apparent to me about a year ago when we saw the economies of our old Cold War enemies, Russia and China, continue to thrive as our own free market economy literally started to melt down.

Now with Washington bailing out AIG, it seems that our Cold War defeat is undeniable. The very same foreign-policy …

France and China are - let’s face it - natural buddies. France has traditionally looked for a political counterweight to the United States, and China is beginning to provide one. China wants to keep the European Union from aligning against it, and France is the EU’s guiding spirit - even if it’s no longer its largest economy. France has strengths in some of the high-tech and heavy industry sectors that China needs. And the European nation also boasts the world’s most-sophisticated array of the luxury goods that newly wealthy China consumers now crave. On the other hand, China has cheap consumer goods that don’t compete directly with French-made products, which means France can allow China to sell them in the European ...

By Keith Fitz-Gerald Investment Director Money Morning/The Money Map Report "Have we seen the worst from the financial sector?" The question - a very good one - came from an audience member following my global investing presentation at the Agora Wealth Symposium in Vancouver, British Columbia. During my entire time there, the interest in the ongoing credit crisis was intense. I took a deep breath and launched into my three-point response. First, I’m encouraged by what I see lately but still believe there is a fair distance to travel before all the skeletons are cleaned out of the financial sector’s closet. There is a growing body of data that suggests banks have recognized only a fraction of the overall potential losses - approximately $50 billion to $75 billion so far on subprime debt alone. And a variety of estimates suggest that total subprime losses ...

“The end is neigh” was what many despondent investors were starting to believe as the past week kicked off with volatile trading amid concerns that US regional bank IndyMac’s demise was a harbinger of many more bank failures.

Furthermore, Treasury Secretary Henry Paulson’s plan to rescue the Government Sponsored Enterprises (GSEs), Fannie Mae (FNM) and Freddie Mac (FRE), left investors unconvinced.

The US government plan caused some agitation since Paulson was essentially asking for a blank check to ensure the funding backstop would be successful in helping the GSEs fulfill their role of providing financing for the US mortgage market. Debt holders were happy with the implications of the plan, but equity holders faced the possible dilution from a government purchase of

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The current credit crisis should be both a squeeze and a crunch, but it seems to have been neither in the euro area. This column explains why credit may become costlier or scarcer under current conditions and explores how European financial entities seem to be defying the negative news. There are two channels through which the present credit crisis can affect economic activity. The first is prices, making credit more costly, and the second is quantities, making it scarcer. Dearer credit is called a "credit squeeze" and while scarcer credit is called "credit crunch". The euro area seems to be suffering neither of the two, at least for the time being. Credit may be getting dearer for at least for four reasons. -Today's banks tend to face higher spreads when issuing debt compared to non-banks, even of the same rating, thus their lending to ...

CNBC Stock Blog: What factor(s) did HSBC’s Jim Steel recently cite as making precious metals “safe investments”?

“The persistently high price of oil, the weaker dollar and the resurfacing credit crisis are driving up the price of precious metals, making them safe investments,” said Jim Steel, chief commodities analyst for HSBC.

Looks like an “all of the above” to me.

You know a financial selloff is getting hot and heavy when they get around to beating down the best and brightest - namely the Blackrock-s (BLK) of the world. So this is when we want to take advantage of the sale prices and begin to rebuild a position. I’m in no rush but since the regional banks are finally taking serious damage, we are seeing some widespread damage in the financials. First we had the investment banks, and large money center banks hit the worst in the first stage of the credit crisis last summer/fall/winter, and now we are on the next stage - major damage in the regional banks. Remember as I wrote in this week’s summary I felt the Federal Reserve will allow some of these to go under because they are smaller and they want to put up a …