Today, the big news that could move commodities is not in China or the Middle East -- it's right here at home. US banks are failing and the Federal Government is going to bail out Fannie Mae and Freddie Mac. I think this has big implications for the US dollar, and not in a good way. I'll be writing more about this in Wednesday's Money and Markets. For now, here is some news of interest ... Fannie, Freddie Too Critical to Fail, Lawmakers Say A government takeover of one or both companies is among several options that have been considered by White House officials, according to a person familiar with the discussions who spoke on condition of anonymity. Senior Bush administration officials are considering placing either or both firms in a conservatorship if their problems get worse, the person said. Paulson Puts Treasury Behind Fannie Mae, Freddie Mac in Bid to Calm Market Paulson, speaking on the steps of the Treasury facing the White ...

Lately, it’s been hard to find a safety zone in the markets. Most key classes are down for the YTD, 4-week and 2-week periods. Only commodities, oil in particular, have been bright spots. The following charts use these ETFs as proxies for key asset classes: VTI - US stock market EFA - non-US developed stock markets EEM - non-US emerging stock markets VNQ - US equity REITs DJP - global commodities* USO - oil alone AGG - US aggregate bond market * DJP represents the DJ-AIG Commodity Index which is a “balanced” index. It limits any one of the 19 commodities it follows to a 15% weight, and any of the 5 commodity groups to a 33% weight. Since oil has been the overwhelming performer lately, DJP underweights oil in comparison to its world significance. The S&P GSCI Commodity index represents its commodities on a world production basis. For a more detailed ...