Unfortunately, this is all that’s holding our fragile economy and financial system together as we enter this most important week of trading. The band aids are the fiscal stimulus programs and government (see taxpayer) funded bailouts of the banking and financial industries.

Day after day we hear from one elected/appointed official after another, each telling us that things are under control because they have a “plan”. Mostly it sounds to me like they have a “plan for a plan”, and that in fact, they have little to no experience in actually running a business,

Following my update, I have included an article from one of the foremost economic analysts of our time, Ambrose Evans-Pritchard. He called the subprime crisis just 6 months before it hit, and this weekend came out with extraordinary comments about the banking …

This will be a quick but important update. The Obama administration, along with our new Treasury Secretary, will be announcing their financial bailout and fiscal stimulus program early next week…likely on Monday or Tuesday. In light of this, look for the market to trade higher in the short term.

No one, and I mean no one, likes Obama’s stimulus package. When you see Democrats struggle to support these socialistic ideals, you know that they are a bad idea. Less than 15% of the stimulus will work its way into the economy in 2009, while the rest will go to support bankrupt social programs…a bottomless black hole.

Seinfeld fans will remember the episode where Jerry refers to people that appear to be the exact opposites of George and Kramer as being from “Planet Bizarro”. Planet Bizarro comes from a comic book featuring Superman and Batman. On Planet Bizarro, everything happens exactly opposite to what we are accustomed seeing on Earth.

As I write this, gold is up $40/ounce and is preparing to blow through $900. As you can see on the chart of gold it is also well above the 50 day moving average and has also just cracked its 200 day moving average. If we can close above $900 I look for a fast move back over $1000/ounce and new all-time highs.

Like many of you reading this, I made a lot of money during the Clinton presidency. Love him or hate him, Bill Clinton and his economic team knew how to stimulate the economy, and they knew how to make the stock market go higher, year after year. Under Clinton’s Presidency we saw the best bull market in US history,

Quick but important point. Everyone…especially those on CNBC and the so-called expert economists (an oxymoron if I’ve ever heard one)…are saying that we cannot have another Depression because “this time” we saved the banking system, which will prevent another Depression from taking place.

Tomorrow is an historic day in the U.S. Our first black American President will assume the highest office in the land, and what most believe is the highest office in the world. Obama won the Presidency with a decisive mandate for “change that we can believe in” and beginning tomorrow we will begin to find out if this is for real,

Trillions are being spent by the US government on bail out after bail out, yet the economy continues to fade away. We’re quickly seeing the excitement from an Obama presidency dissipate, as leading Democrats (from his own party no less) openly question key components of Obama’s $2 trillion economic stimulus program.

On Friday, the December unemployment numbers were released and the official stats showed us losing another 524,000 jobs with unemployment reaching 7.2%. The total losses make 2008 the worst year since 1945, when the US was coming out of WWII.

As the article below spells out, gold has dropped about $40/ounce recently due to annual commodity index rebalancing. This pullback may represent the best opportunity to buy gold for the remainder of the year. Interestingly, our gold stocks continue to rise sharply in price, even in the face of the decline in the commodity itself.

For the last 20 years plus I’ve been amazed by the vast conflicts of interest that exist on Wall Street and in the financial industry. My first wake-up call was watching my first investment firm implode because of its own internal conflicts and mismanagement of an IPO of a mortgage derivatives fund,

“May you live in interesting times” … Ancient Chinese Curse That’s right. This famous Chinese proverb was actually written as a curse, and I’d say that it totally and completely sums up this past year. 2008 just became the worst investment year since the Great Depression, with losses of 35-40% for most major indices.

When the news broke about the $50 billion Ponzi Scheme that Bernie Madoff engineered over a twenty to thirty year period, I knew the story rang a bell. I went back through my records and found the original Barron’s article in 2001, and written by Erin Arvedlund.

The bear market rally continued today, this time thanks to never before seen moves by the US Federal Reserve. They not only dropped the Fed Funds rate by .50%, but also made it very clear in their forward looking comments that they would provide record amounts of liquidity to the markets going forward …

It’s snowing here as I write this…actual flurries. We rarely get snow in Houston, so this is a fun time for us. The last time we had snow was Christmas eve, 2004. Prior to that it had been at least 10 years, so I’ll have to ask all of you that live in colder climates to bear with my reaction to the white stuff.

As I forecast yesterday, the market had a fairly tough day today, ending down over 240 points. If the auto bailout does not take place…as the market is expecting…we could see a 500-1000 point drop in no time at all. I continue to believe …

It's probably the last thing anyone wants to hear so soon after news of the 533,000 lost jobs lost month (announced on Friday) -- but if history is a guide, it's only going to get worse from here. Details to follow…