Currencies back off gains…Administration slaps tariff on China…And Yen rallies…Quotes from Davos…And Now… Today’s Pfennig!

Good day… And a Marvelous Monday to you! I hope your weekend was grand… I was supposed to be traveling back from Williamsburg today, so this is a bonus day for you all! HA! On Friday morning, I told the early arrivers that the currencies were strong, Gold was strong, it was all good, and we needed to close up shop and go home, because it wasn’t going to get an better than that, and that the rest of the day had nothing but disappointment risk! Boy did I nail that one on the head! Let’s get to the goings on.

The currencies added to their gains during the Friday morning, only to see them give the gains back later in the day, as the “boys” in NY all closed shop and headed to the Hamptons. I

With the global economy on the mend, could gold be gearing up for another record-setting run? It sure looks that way. 

After peaking north of the $1,000 per ounce price level last year, gold hit a stumbling block when deflationary fears in the world’s largest economy sucked the air out of commodities prices and sent hoards of investors stampeding into the safe-haven of U.S. Treasuries, and helped spawn a rebound in the U.S. dollar.

Since that time, the global economic outlook - especially beyond U.S. borders - has improved, and gold prices have stabilized.

The next step - many gold bulls say - is for the yellow metal to make a run for new highs.

Gold started 2009 at about $870 an ounce - down substantially from early 2008 when prices hit a record-high $1033.90, but significantly higher than the $712.30 an ounce it was trading at in mid-November.

Then, when talk of inflation

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Two days of talks between U.S. Treasury Secretary Timothy F. Geithner and Chinese officials culminated yesterday (Tuesday) with both parties reaffirming their confidence in the value of the dollar, and the viability of U.S. debt.

Despite this …

Euro goes back and forth over 1.43…Eurozone unemployment rises to 9.2%…Australia’s GDP surprises! Is it protectionism? And Now… Today’s Pfennig!

Good day… And a Wonderful Wednesday to you! I’m draggin’ the line today, as I was helping my oldest son, Andrew, with things in his brand, spankin’ new house, last night. Congrats to Andrew, for finding a great bargain, with a low, fixed, interest rate!

OK… Whew! What a day in the currencies yesterday! Another day, and another day of wild swings.. Volatility is the name of the game these days… Watching, for instance, the euro trade down to 1.4220, and then up to 1.4320 and not just on a one-way ticket! Oh No! this is a bounce here a bounce there… But just like it was going from 1.41 to 1.42, it took a few times over the 1.42 figure before it finally stuck, and headed to 1.43… All the other

The US stock market is enjoying one of those delightful episodes when all news is good news. The Dow Jones Industrial Average jumped 221 points yesterday to 8,721 - lifting the Blue Chip index to within a whisker of a positive year-to-date performance.

Let’s give credit for the rally to good news… and also to bad news, because that’s also good news. In fact, let’s just give credit to news in general.

Topping yesterday’s headlines was the “news” that General Motors (NYSE:GM) had formerly declared bankruptcy. The automaker’s de facto bankruptcy of the last several years finally yielded to the de jure variety. That’s good news, because now we taxpayers get the chance to increase our charitable giving. We get the opportunity to write a $50 billion check to one of America’s largest and most beloved nonprofit organizations.

But wait, GM’s bankruptcy wasn’t the only good news to cross the wires yesterday.

GM’s Chapter 11 Bankruptcy and the US Governments International relations

“You ain’t seen nothin’ yet!”

Actually, we’ve seen so much already that it’s hard to believe there’s more coming. But there’s sure to be more… and we have a feeling it will be worth the wait.

Yesterday, for example, GM filed for Chapter 11 bankruptcy protection. It couldn’t pay its bills. GM was once the strongest corporation on the planet. But it has been around for nearly 100 years. Heck, everything wears out eventually… even a ’55 Chevy.

“Obama Nationalizes GM,” says a triumphant headline in France’s “La Tribune.”

Triumphant?

Yes. According to the papers, Obama may have been handed the keys to GM… but the old jalopy is worn out. The French say the whole US economic model is ready for the junkyard. More on the French - and the French model, below…

First, let’s stick with the USA. The Dow rose 221 points yesterday

old was taken down a few dollars in Sunday night trading by the bullion banks in New York…but once Sydney and Hong Kong opened for the day, gold [and silver] returned to the plus column. Gold saw its highs moments before Hong Kong closed…and silver shortly after…in early trading in London. From there, both metals got slowly sold off. The real action didn’t start until the Comex open, where every rally attempt in either metal…but gold in particular…got sold off by a not-for-profit seller.

With oil up, the US$ down…and the CRB making a major upside move…$1,000 gold was a 12″ putt. But it was obvious [at least to me] that someone didn’t want that to happen…at least not yesterday. Platinum and palladium were both up almost two percent.

The open interest numbers for Friday’s big up day in both gold and silver were

Bonds down. Gold up $17. Someone seems to think there is a whiff of inflation in the air. Sniff…sniff….

We’re not so sure. It seems too early to us.

But we’re not even going to think about it. Today, we’ve got to make tracks. We’re traveling.

In light of our voyage we’re turning today’s essay over to guest host Ian Mathias, of Agora Financial’s 5 Min. Forecast. He’ll take over from here…

Your family’s share of the government debt is now over half a million dollars. A record $546,668, to be exact.

That cheery Monday stat comes courtesy of a USA Today study, which claims that each American family’s share rose 12% in 2008. That’s $55,000 in new government debt last year for every US household – thousands more than the median household annual income. Here’s how it breaks down:

HIDDEN VALUE

Dear Reader, 

Is China buying gold to protect itself from the worst financial crisis in history? 

Although we can’t be 100% sure, we can make a compelling case. 

This from Ed Steer, who writes for our friends over at Casey Research… 

In the last three days, I’ve noticed that there has been a change in pattern during Far East trading. It’s not a lot, but it’s something I haven’t seen since I started watching the Kitco gold charts about ten years ago. A buyer [either going long, or covering short positions] is active in Hong Kong trading [in both gold and silver] that I’ve never seen there before. Is it something… or is it nothing? I know that three days activity can hardly be considered a trend… but

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