Commodity prices and world stocks rose while the U.S. dollar and government bond prices slipped on Friday when investors cautiously put money back into riskier assets.

October 27, 2008 was the gold mining sector’s Black Monday, the day nearly every stock hit rock bottom. Hindsight makes it plain they got caught in the violent deleveraging that sucked down every equities market in the world.

World stocks took yet more losses Tuesday, with Europe shares hitting a record low, a day after most equity markets suffered a thorough battering at the hands of investors fearful for the global financial system.

Dollar slides across board, hits 2-mth low vs euro… Dollar hits 2-mth low vs basket of currencies… Focus on fate of U.S. automakers, Fed rate decision

Dollar weakens to two-month low versus euro… Oil climbs nearly 7 percent; OPEC supply cut expected

Dollar rises vs euro as risk aversion persists…  Yen supported on persistent global economy fears…  Euro zone inflation plunges

SO the SPOT GOLD PRICE sank in October, dropping right back to 13-month lows at $683 an ounce. After failing to breach $930, this collapse marked the third step lower from March’s all-time high of $1,032. And from a technical perspective, the Gold Chart looks horrible – recording lower lows and lower highs for the last six months and more.

Is the market over-valued? In this week’s Outside the Box, one of my favorite global equity analyst’s (and no stranger to regular readers), James Montier of Societe Generale does some very interesting analysis on the European and US markets and finds the number of stocks which make his list as possible for being a “short” is at very high levels.

It’s not only the clouds outside that seem to be lifting. Optimism broke out in various quarters, reflected in global equities. The Dow closed above 13,000 on Thursday. The Nikkei closed above 14,000. The FTSE 100 was over 6,100 by mid-day Friday.

The mood seems to be lifting. A more optimistic tone in the Sunday papers…a prod of encouragement from the Bank of England…and now global equities are surging.