Gold Hits 28 - Year High as Dollar Struggles (Reuters)
You probably could have guessed this even if you hadn't been paying attention, but gold has hit a fresh 28-year high, as they're now charging $735 an ounce for the stuff. $735 an ounce! Remember, gold does nothing. It just sits there and looks pretty. You can't plant it and you can't run your car on it. And, for the most part, you can't buy anything with it until you turn it back into dollars. So it's quite remarkable that people would pay so much for it. It's obvious that when it comes to money, our reptilian brains still dominate in times of fear. Anyway, we agree with Eddie that the weakness in US money has more to do with our new bill designs, with all kinds of multicolor, than it does to do with inflation. As we've always said, "third world looking currency warrants third world valuations". What's next, holes in our coins?
UAW rejects retiree health care proposal (Thomson Financial)
Don't worry, the world hasn't changed, the UAW and GM are still at an impasse about retiree health care, with no solution in sight. Thank god, because if the two sides did agree, our worldview would be shaken. Too much for a Friday.
Sheikdom shakedown: Dubai moves on Nasdaq (WorldNetDaily)
Has the Opening Bell hit a new low by linking to WorldNetDaily? Perhaps. Nonethless, they're running a completely reasonable and logical article about the reaction among politicians to news that Dubai is looking to take a stake in the NASDAQ; naturally, they're worried about the political and national security implications. This is, of course, totally backwards. If you want peace with the middle east, then Middle East power need a bigger stake in our economy. After all, you're not going to fund terrorism with your oil money, when you've got a big chunk of your money locked up in a major US stock exchange. Just wouldn't do it.
State investment firm buying stake in Carlyle (Toronto Star)
Forget what we just said above; we've seen Farenheit 9/11, so we know all about the shady Carlyle group and its connection to Mideast money (and its connection to the Bush administration; which if you put the two together means that 9/11 was an inside job). Anyway, as if Carlyle hadn't already sold us out, it's now selling a significant stake of itself to an invest group owned by the Abu Dhabi government. We just hope congress is looking out for us.
Accord Seen on Revising Mortgage Rules (NYT)
The Bush administration is coming around to the idea that Fannie and Freddy should be allowed to expand their loan portfolios in order to protect the economy against rising defaults and foreclosures. If you ask us, this is as scary as the 50 bps rate cut in terms of moral hazard. Thing is, not only is there a big moral hazard, in terms of buying up all these mortgages that probably aren't worth anything, but it's Fannie and Freddy doing the borrowing, two of the more poorly run companies you can conceive of.
Shell, Saudis to Spend $7 Billion on Texas Refinery
Now this is scary; the Saudis are going to invest billions to double the size of an oil refinery in Texas. What the hell, don't they have their own energy industry to focus on?
Welcome Erick Schonfeld, My New Co-Editor (TechCrunch)
For those of you who are going to miss Business2.0, and as we've said a million times, we only read it when we were in airports and on planes, former editor Erick Schonfeld is going to start blogging over at TechCrunch, which is pretty big, at least in a metaphysical sense. Congrats to Erick for landing a paid blogging gig. It's cool. Actually, the most interesting part of the whole story is that TechCrunch wanted to merge with B2.0. Not sure how that would've worked, but apparently that would've stretched the world's fabric of reality too far, so it never materialized.
Canadians Find Better Bargains in US (AP)
It's one thing to read about currency parity, like in a vague, theoretical sense. But it's a totally different thing to read about Canadians taking shopping trips to the US and feeling "pride" in their economy. It just doesn't make sense! They have socialized medicine; they're supposed to be slouching towards oblivion.
Finland's Stora Enso to Sell North American Unit to NewPage (AP)
Major shakeup in the paper market (the actual paper market, not the commercial one), as Finland's Stora Enso is selling its North American unit to NewPage, which is currently owned by Cerberus. The $2.6 billion deal will consist of $1.5 billion worth of cash, with the rest coming from various notes. Just out of curiosity, how many of you knew that Stora Enso was the oldest corporation in the world, with the first shares dating back to the 1200s?