James Dale Davidson provides some essential tips for your investment strategy during this credit crisis. The government had admitted that we face trillion-dollar deficits for years to come. And who knows how much bigger the budget hole could grow with companies like GM lapping up Uncle Sam’s bailouts. But there are always way to protect your wealth… and even make a profit.

President-elect Barack Obama’s transition team is reportedly putting the finishing touches on an economic recovery plan that could run from $675 billion to $1 trillion, though many experts believe the program will most like range between $700 billion and $800 billion.

Although trading was thin once again yesterday, there was obviously someone not interested in seeing the gold price do well. Twice in early trading (at least to us here in North America)…the first occurring shortly before Hong Kong closed and London opened (4:30 p.m. in Hong Kong…8:30 a.m. in London); and the second time was at 7:45 a.m. in New York, just before the Comex opened…which would be 12:45 p.m. in London…lunchtime for them. Both times gold got hit for about US$8 in a matter of minutes. Not a lot, but enough to make sure that gold finished down on the day. Whether these two smack-downs were local traders, or traders from New York entering the market on the Globex…

Home prices fall… again. The latest record-setting swan dives… Chris Mayer on how to spot the bottom… and what to buy when it comes… World’s biggest companies hold shockingly little cash… global market in the hands of Buffett, China… But can China capitalize? Byron King on how China has “reached its pinnacle”… Russian professor predicts end of U.S. by 2010… will Houston be taking orders from Mexico City? Plus, your prophecies for 2009… and The 5’s editors issue a forecasting challenge

GMAC Files to Become a Bank; Unemployment Nears 26-Year High; Mogul Signals Interest in Circuit City; Banco do Brasil Buying Out Rival; Crude Continues Slide; JPMorgan Cuts 3,000 jobs; Stock Market Craters.

The S&P 500 Index (.INX) opened today at 795. That’s the first time the index has been below 800 since April 1997. Eleven years of stock gains have vanished.

July’s slump in commodity prices has been grabbing a lot of attention lately. Crude oil prices are down over $20 from their peak of $147 a barrel. Gold prices have fallen some $80 since mid-July.

But Daily Reckoning editor Bill Bonner says commodities are experiencing a correction rather than fundamental change in direction.

Bill says the bull market isn’t over yet. Firstly, the current commodity cycle has not yet run its historical norm of 15 to 20 years. More importantly, there is no Paul Volcker at the Fed prepared to take on inflation..