Dear Beijing:

You’re an adolescent in a grown-up economic world. Ending short selling is an awful idea. It’s like wearing a raincoat while taking a shower.

We quote the book that started the Internet revolution in the United States, which has since spread to the whole world. It’s called The Whole Earth Catalog (1968):

In a broad indication of how low in esteem gold is held right now, even after a nearly 20% sell-off in Greek equities as their bourse re-opened, the yellow precious metal fell significantly today.

If the Fed sneezes, investors catch a cold. That’s a variation on the old adage about the U.S. sneezing and the world catching a cold.

As markets continue tor respond to yesterday’s Federal Reserve press release and comments, they also are digesting data that said the U.S. economy grew at a 2.3% rate in the second quarter. The anemic growth in the first quarter was revised slightly upward. But, at the same time, growth in the three previous years was revised down.

Gold held its breath as it awaited the Federal Reserve presentation as well as after the FOMC meeting that ended today. It declined a bit, and then rose slightly despite a stronger greenback. The Fed offered no new wishbones to pick over, restating what most of us know already.

Led by energy stocks, the Dow and S&P 500 rose around 1.00% today, reversing the struggles and narrow-range volatility they’ve experienced recently. The NASDAQ was also up. In Europe, the DAX and CAC were both up a touch more than 1.00%.

We start the week with a prediction. Not our prediction, but an assessment from Deutsche Bank.

Deutsche's paper, “Estimating Fair Value For Gold” contends that the price of the yellow precious metal must drop substantially to bring valuation levels back towards historical averages.

Earlier this week a data survey showed that sales of existing U.S. homes rose in June to their highest level in nearly 8-1/2 years and new jobless claims fell to their lowest in more than 41 years. Good news. Or should we add a question mark… good news?

Weekly unemployment filings in the U.S. sank to their lowest levels in more than 41 years last week. This should be cause for jubilation throughout the land, indeed throughout the whole world. Everyone everywhere needs the American economic behemoth to work its mighty magic in the global economy.

The sell off in commodities is affecting all the complexes. If it continues, we will see its effect in the form of lower inflation, which in turn may cast a shadow on a potential interest rate hike by the Federal Reserve.