Despite rising Treasury Note yields, US stock markets yesterday closed at their highest level for 2009. Also, commodities were driven higher by reports indicating that the recession is abating, but the US dollar retreated on concerns of the huge issuance of government bonds.

Elsewhere, Chrysler completed its deal with Fiat, the US Treasury Department announced that ten banks would repay TARP funds, and the Obama administration is dropping its plan to cap salaries at firms receiving bailout funds and has backed away from a large-scale reduction in the number of agencies overseeing financial markets.

Coverage of these events on camera this week included discussions with John Hussman, Chris Whalen, Peter Peterson, Paul Krugman, Mohamed El-Erian, Laszlo Birinyi, Jim Rogers, Jim Grant and Francisco Blanch.

The selection kicks off with the highly regarded John Hussman sharing his wisdom and concludes with an interesting snippet on Africa as an investment destination.

Last year when oil made its steady climb to nearly $150 a barrel, Supperlattice’s stock went from $0.34 to $2.55 in just two months for 650% gains. When oil prices began to descend, so did SLAT.OB. What makes Supperlattice’s stock price so strongly correlated with oil prices? The company is focused on developing and marketing next-generation lithium-powered batteries to replace gas powered engines.

With oil producers postponing and canceling major projects, many fear that oil prices will once again spiral out of control because of lack of supply when the economy turns around. Francisco Blanch, head of global commodities research at Merrill Lynch, wrote, “The current WTI crude oil price weakness may be setting the stage for another rally in crude oil prices as the world emerges from the recession. Delayed and canceled projects on energy infrastructure will only add to the same

Merrill Lynch Kisses Up to Gold, Predicts It Will Hit $1,500

by: Jason Hamlin February 04, 2009

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A sharp reduction in spending by oil producers points to a quick recovery for oil prices once the economic downturn begins to alleviate. Notably, cash-strapped producers have cut budgets faster and deeper than in past downturns. This lack of investment is already speeding up the rate of decline in older fields, and delaying the start of new production.

Service companies, such as Enterprise Oilfield Group, see a possible repeat of the last four years. During this period, oil prices rose to record levels as demand grew faster than new supplies, an imbalance that some believe was caused by a lack of investment during the previous downturn. With oil producers postponing and canceling major projects, history is very likely to repeat itself.

Francisco Blanch, head of global commodities research at Merrill Lynch, wrote, “The current WTI crude oil price weakness may be setting the

Dear Value Seeker,

Sometimes words speak louder than actions.

Especially when it’s the Fed’s words.

Today, market watchers are on the lookout for clues about how the Fed is going to tackle deflation.

A rate cut of at least 0.5% is already in the can as far the pundits are concerned.

But with consumer prices plunging, investors expect the Fed to signal more emphasis on more unorthodox ways of ‘stimulating’ the economy.

According to MarketWatch, “The bottom line on Fed policy is supply of money. The Fed typically targets the price of money but, with the price so low, it will focus on increasing the quantity of money through its balance sheet.”

Not that the Fed hasn’t tried this already.

It has doubled the size of its balance sheet to over $2 trillion since September.

As Bud Conrad at Casey Research notes, “Mostly under the covers, [the Fed]

Gold pushed over $850 in early London trading, and again during the first hour in New York yesterday, but then eased in listless action to finish the day little changed at $834.60, up $2.40. Overnight, gold has pushed higher.

Platinum was up sharply in the far East, then traded tightly rangebound through the day, rolling between $1020 and $1040 and ending at $1032/oz., up $45. Overnight, platinum has fallen off.

Silver was also rangebound, between $10.70 and $11.10, but fared better than gold as it closed in the upper part of the range at $10.96/oz., up 29 cents. Overnight, silver has edged lower. (Click here for charts)

It was a generally up day for the precious metals, as equities retreated after Monday’s big runup, and oil sank along with the dollar.

Gold’s lack of sharp movement is obviously, at least partially, the result of it being pulled on hard from opposite directions.