By Keith Fitz-Gerald In a Money Morning commentary back in April, I suggested that while we’d hit a new market bottom, we almost certainly hadn’t hit the market bottom. So have we now? That’s tough to say, although three seemingly unrelated bits of data suggest the ultimate market bottom may be lower still, meaning investors aren’t out of the woods, yet. Let’s take a look: Since 1990, there have been 13 declines of 10% or more in the Standard & Poor’s 500 Index. And while each drop of this magnitude tends to precede a rally of six months or more, an ultimate market bottom typically hasn’t been established until we’ve seen an average reading of 36.3 in the Chicago Board Options Exchange Volatility Index - usually referred to as the VIX Index. Generally regarded as a ...

By Shah Gilani It’s the end of the "American Dream." It’s the story of how the inevitable bailout of insolvent housing giants Fannie Mae (FNM) and Freddie Mac (FRE) - with the Federal Housing Administration soon to follow - will ultimately lead to such sorrowful sequels as "TheDeath of the Dollar," "The Downgrading of U.S. Government Debt" and, yes, "The Depression." Let’s be very clear on one point, however: There’s no question about it - Freddie and Fannie have to be supported. If the doctrine of "too big to fail" didn’t already exist, it would have to be invented - immediately. Although many are arguing against a "bailout," those "experts" never seem to address the fallout that would emanate from such a strategy. Nor do they ever discuss the sad series of events that brought us to ...

By Keith Fitz-Gerald Investment Director Money Morning/The Money Map Report We can almost hear that ominous "Jaws" theme music in the background and can see that huge dorsal fin as it slices threateningly through the water - knowing full well that the real terror is hidden beneath the water’s surface. But this time around, it’s not a "Great White" that’s sparking our fears; it’s a well-capitalized and broadly based series of secret stock exchanges known as "Dark Pools of Liquidity," "Dark Liquidity," or just "Dark Pools." Most investors have never even heard the term - and are truly shocked to discover these "off-the-books" trading networks actually exist. But to Wall Street insiders looking to anonymously move billions of dollars in stocks, bonds, and other investment instruments, dark pools are de rigueur - especially when you’re an institutional trader who doesn’t want ...

By Jennifer Yousfi Managing Editor The Boeing Co. (BA), one of Money Morning’s “Global Titans,” yesterday (Wednesday) released a report that predicted $3.2 trillion in aircraft sales over the next 20 years, as air travel picks up despite current price pressures. “During 40 years of producing the Current Market Outlook, we have learned that the resilience of air transport growth comes from its intrinsic importance to the livelihood of people around the world,” the report from Boeing reads. Boeing’s annual Current Market Outlook estimates that passenger travel will grow at a 5% rate, and cargo will grow at a 5.8% over the next several years. Despite record fuel costs, air travel and shipping has become an integral part of daily life for many consumers and businesses. Boeing says that demand will only grow. A lot of that growth is expected to come from ...

By Martin Hutchinson Contributing Editor Forbes Magazine has come out with its list of "Best Countries for Business" - and Denmark ranks as the world’s most business-friendly market. But unless an investor is looking to set up shop in one of these countries, you wouldn’t expect this list to be all that valuable. After all, it’s one thing to know that when a company operates in a business-friendly market, its employees and corporate officers will be well treated, and the company itself will be afforded respect. But does that necessarily allow us to predict whether or not investments in that country will appreciate in value? The truth may actually surprise you. Okay, it’s mean to leave you in suspense until the end. You can find out whether a good business climate is correlated with economic growth by comparing the country’s ranking ...

By Jason Simpkins Associate Editor After a disappointing string of failed takeovers, CNOOC Ltd. (ADR: CEO) has reignited its foreign expansion initiative with a $2.49 billion buyout of Norway’s Awilco Offshore ASA. China Oilfield Services Ltd., a unit of China’s top offshore oil and gas producer will pay $16.66 (85 kroner) a share, an 18.7% premium to last week’s closing price. Awilco’s board unanimously approved the offer and the deal, which still requires regulatory approval, but should be closed by October. China Oilfield will borrow about $2.3 billion to finance the deal. "I think 85 kroner a share is a good price," Stian Eliassen, an analyst at Carnegie ASA in Oslo, told Bloomberg News. "They’re very interested in Awilco’s jack-up rigs, seven of which will be available to be leased by clients next year."...

By Jason Simpkins Associate Editor Payrolls tumbled for the sixth consecutive month in June, bringing the total number of job losses in the first half of the year to 438,000. Such a steep drop in employment could easily cause consumer spending to falter in the months ahead and drag the economy into a recession. After shedding 62,000 jobs in May, U.S. employers slashed another 62,000 jobs in June, the Labor Department said last week. Builders reduced payrolls by 43,000 after cutting 37,000 employees in May. Financial firms cut 10,000 jobs in June after losing 3,000 the month prior. And factory payrolls dropped by 33,000 after declining 22,000 in May. The national unemployment rate has gone up by a full percentage point in the past year, hitting 5.5% in May. The country added 91,000 on average in 2007, but has lost an average of ...

By Jason Simpkins Associate Editor Consumer spending in the United States rose an unexpected 0.8% in the month of May, the biggest increase since last November, as nearly $50 billion worth of rebate checks were cashed and put to use. Incomes grew 1.9% in May - their biggest jump in nearly three years - and the Commerce Department said rebates fueled a 1% surge in retail sales for the month. However, analysts have been quick to dismiss the figures as an apparition that will dissipate along with government assistance. “This is the tax rebate that you’re seeing here,” Chris Low, chief economist at FTN Financial, told Bloomberg. “It’s a sense of hope, but it doesn’t last. Call it a holiday from reality.” Story continues below… Sign up right now, ...

By Jason Simpkins
Associate Editor
Gold surged nearly 4% yesterday (Wednesday), as the U.S. Federal Reserve appears hesitant to raise lending rates despite signs of severely escalating inflation.

The price of gold jumped $30.30 to trade at $915 an ounce as of 11:45 a.m. EDT, its highest level since May.

“The Fed said that inflation is a major concern, but they’re not going to do anything about it, which made gold go ballistic,” Leonard Kaplan, the president of Prospector Asset Management, told Bloomberg News. “The dollar is going to get slammed again.”

After meeting yesterday, the Federal Open Market Committee acknowledged inflation as a growing problem, but also expressed its belief that an economic downturn would eventually blunt demand for goods and drive down prices.

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By Keith Fitz-Gerald Investment Director Money Morning/The Money Map Report No question, President George Bush’s approval ratings have pulled an “Enron.” A recent Associated Press-Ipsos poll conducted June 12-16 showed only 29% of the public gave Bush a favorable rating. It’s the least favorable approval rating for a U.S. president since Jimmy Carter’s approval rating dropped to just 22%. While that lousy view of the job Bush is doing will help set up a more-contentious election in November, here’s a curious fact that investors will find quite rewarding: The key to better stock-market returns isn’t having a president we “love” - it’s having a president that we don’t quite hate. Let me explain. According to a study of presidential approval ratings by Ned Davis Research that looks back all the way to the days of President John F. Kennedy, when ...