Phil Flynn, of Alaron Trading, responded to the Chinese news by calling it “a lot of stimulus that the market wasn’t expecting … It’s a two-year project, and it will increase energy demand from China.”

Flynn added that any gains may not be sustainable, though. “China has gone from having to slow their economy to having to boost it,” he said. “The market is still trying to determine the extent of the global economic downturn. In the meantime, we remain in a trading range, trying to break higher into the [$70 a barrel range] or breaking down in the $50s.”

The big factor is OPEC’s “pledge to cut production even deeper if prices are not in the $70-$90 range,” says Kevin Kerr, editor of Global Commodities Alert. “Giving that threat some teeth is the fact that the Saudis seem to be on board with the cuts.”

Kerr added that it’s clear OPEC is “fearful of an Obama presidency and what the longer-term impact to their industry will be,” and said the cartel will likely “vigorously defend the $60 level.” ”

Source:  Crude up slightly -  Drops below $60 but recovers

“October is at last ending – the worst month in commodity history,” Eugen Weinberg, an analyst at Commerzbank AG in Frankfurt, told Bloomberg. “Investors are expecting lower growth for the longer term and that is putting prices under pressure.”

The news came one day after the revelation that the U.S. economy shrank 0.3% in the third quarter, and on the very same day that the government announced consumer spending tumbled 0.3% in September – meaning the world’s largest economy is struggling to produce and purchase.

It also continues a steady, months-long decline of commodity prices.

The past year’s inflation epidemic has waned significantly because consumer spending and demand has significantly cooled.

Prices for staple foods such as corn, soybeans and wheat have all come down from their record highs in near perfect harmony.

Corn futures are down nearly 50% from their summer high of $8 per bushel. Same story and stats for soybeans and wheat, the latter hitting a 16-month low in mid-October.

Gas prices have fallen 37.1% from their July 17 high of $4.114 a gallon.

Not coincidentally, gold has fallen 21.1% in that same time frame.

Short-term prices are likely to continue to wane or tread water, as economies around the world are hording their pennies and trying to build capital to start buying again.

“The outlook for demand remains weak while we wait for economic rescue measures to feed their way through the system,” Christopher Bellew, senior broker at Bache Commodities Ltd. in London, told Bloomberg. “Even in emerging markets the growth there is likely to be lower than was previously expected.”

Source: Commodity Prices Sinking to 52-Year Low

Make no mistake: If that happens, there are two clear culprits – current Fed Chairman Ben S. Bernanke, and his predecessor, Alan Greenspan.

Bernanke “and Greenspan together will probably bring [about] the end of the Federal Reserve,” Rogers said during the interview in Singapore. “We’ve had two central banks in America that failed [and] this third central bank will probably fail, too, because of Bernanke and Greenspan. The Federal Reserve [just] put $200 billion more onto its balance sheet of mortgages. Now I don’t know how big they can expand their balance sheet, but if they keep doing it, there’s only so much – and they just bought Bear Stearns (BSC).”

Rogers first made a name for himself with The Quantum Fund, a hedge fund that’s often described as the first real global investment fund, which he and partner George Soros founded in 1970. Over the next decade, Quantum gained 4,200%, while the Standard & Poor’s 500 Index climbed about 50%.

It was after Rogers “retired” in 1980 that the investing masses got to see him in action. Rogers traveled the world (several times), and penned such bestsellers as “Investment Biker” and the just-released “Bull in China.” And he made some historic market calls: Rogers predicted China’s meteoric growth a good decade before it became apparent and he subsequently foretold of the powerful updraft in global commodities prices that’s fueled a year-long bull market in the agriculture, energy and mining sectors.

Given Rogers’ prescience – not to mention all the uncertainty facing U.S. investors right now – we thought it was well worth a sit-down with the noted guru, even though it meant traveling all the way to Singapore, where he now lives with his family, to do so.

During that interview here in Singapore, Rogers also said that:

• Although the United States faces perhaps its most daunting economic challenges in at least a generation, “in America, most people do not understand that there is a problem.”
• Because of these weak-dollar efforts – as well as the billion-dollar bailouts – “America is now the largest debtor the world has ever seen.”
• Although the central bank seems intent on engineering a U.S. economic rebound by creating an ultra-weak dollar, no country in history has ever emerged from a serious financial crisis by “debasing its currency.”

The bottom line: The strategies that the central bank is currently employing are nothing short of “outrageous,” Rogers said.

“You know, I’ve read the Federal Reserve Act,” he said. “Nowhere does it say [the central bank is] supposed to bail out investment banks! Nowhere does it say you should bail out Wall Street. Their mandate was to have a sound currency, and then it was later expanded to have employment – to help employment. But nowhere does it say: ‘Bail out investment banks.’”