With the Rally Nearly Over the Germans are Buying Gold.

The Dow fell another 107 points yesterday. Oil held steady at $70. The dollar fell to $1.38. And gold rose $4 to 932.

What if the rally is over? Could be… It began on 9 March. That makes it more than 3 months old. Most likely, it will continue through the summer. But who knows?

The important thing to remember is this: there can be no major, sustained bull market without one of two things happening.

Either… the mistakes of the Bubble Epoque must be cleared away… allowing for a new era of genuine growth and real prosperity. At best, this would take a few years to achieve. Just imagine how long it will take to restructure GM into a profit-making business again. Just imagine how long it will take consumers to pay down their debts so they can begin to spend again. Just

The U.S. unemployment rate, currently at a level of 6.5%, could rise to 8% next year. But it could also find a ceiling sooner than expected, as more companies implement unpaid vacations and four-day workweeks to preserve jobs.

The U.S. recession may just now be entering full swing, but storm clouds have been gathering for more than a year and many companies have already trimmed payrolls. Now, the goal for many companies is to prepare for an economic rebound by finding ways to keep the their skilled productive labor intact.

“More companies are exploring alternatives to layoffs,” John A. Challenger, chief executive of consulting firm Challenger, Gray & Christmas, told BusinessWeek. “If they can keep people on until the business turns around, the company would be in much better shape to ramp up quickly.”

Dell Inc. (DELL) employees, for instance, recently received a memo

Some more news on the economic front this morning ...* Mortgage applications plunged in the week ended September 26, according to the Mortgage Bankers Association. The purchase index dropped 10.9% from the previous week, while the refinance index tanked 34.7%. At 304.8, the purchase index is the lowest since February 2002. Interest rates were relatively stable (6.07% on the 30-year, down slightly from 6.09% a week earlier).* The outplacement firm Challenger, Gray & Christmas counted 95,094 job cut announcements in September, up 7.2% from August and up 32.6% from a year earlier. Computer firms led the list of announced cuts at about 25,700 in September. Automotive companies were next at just under 15,000, with apparel (8,350) and financial firms (8,244) next.* On the other hand, the ADP Employment report was less negative than expected. It showed the economy losing just 8,000 jobs