"I'm sure the rising cost of energy is bothering the market," said Fred Dickson, chief investment strategist at D. A. Davidson & Company last week. "I do think the uptick in gasoline prices will have an impact on consumer spending in the next few quarters."
The International Monetary Fund (IMF) now predicts that the size of China’s economy will surpass America’s by 2016, far earlier than most mainstream economists have been forecasting. Some analysts ridiculed the Fund’s prediction, but others warned that it could happen even sooner.
China's Central Bank Chairman Zhou Xiaochuan told a Chinese monetary conference last week that “Foreign-exchange reserves have exceeded the reasonable level that our country actually needs,” which is essentially code for China won't be buying U.S. government debt any more. China's foreign currency reserves exceeded $3 trillion at the end of March, more than $1 trillion of which is U.S. government debt.
The recent decision by Federal Reserve Chairman Ben Bernanke to begin holding press conferences may be one more indication of the increased influence of Representative Ron Paul (R-Texas). The Federal Reserve has long ignored the public and conducted its proceedings in cloister, but the Wall Street Journal reported April 21 that Bernanke will hold the Fed's first scheduled press conference ever after Wednesday April 27 Open Market Committee meeting.
The price of one ounce of gold exceeded $1,500 yesterday, and immediately the media was filled with explanations. Jan Harvey, writing for Reuters, said gold was benefiting from “the threat of a downgrade to the United States’ triple-A credit rating this week and fresh worries over euro zone debt [that] fueled fears over the outlook for both the dollar and the euro.”