The longer the rally persists, the more dangerous it becomes.

At least something good has come out of the economic crisis; it blew off the purple robes that clothed economists and exposed their naked flanks. Still, they don’t deserve the beating they’re getting in the press – with snide remarks and sarcastic comments; they deserve better. A beating with sticks!

The future cometh…Cash for bankers! Cash for Detroit’s clunkers! From one scam to the next…But first, let us turn to the latest market update.

Bonds down. Gold up $17. Someone seems to think there is a whiff of inflation in the air. Sniff…sniff….

Both gold and silver were comatose all night long in the Far East…and all through European trading once again. However, the moment that the London p.m. fix was in, both metals’ prices went vertical. Silver got capped before it hit $13…but gold managed to close above $900, and is now above $910 as I write this. As I said yesterday…Friday is options expiry…so be ready for anything. But even I wasn’t expecting that. Today’s New York price action should be enlightening.

“We do not want a disclosable event.” Thus spoke former Treasury Secretary Hank Paulson to Bank of America CEO, Ken Lewis, last December.

Mr. Timothy Geithner was the man who was on watch when the ship ran aground. His job, as head of the Federal Reserve Bank of New York, was to keep an eye on Wall Street. Now, he’s come forward with a new $1 trillion plan to get the boat back on the water.

U.S. Treasury Secretary-nominee Timothy Geithner told the Senate Finance Committee yesterday (Wednesday) that drastic measures are needed to combat the U.S. recession and promised to overhaul the beleaguered $700 billion Troubled Assets Relief Program (TARP).

A price tag has emerged for President-elect Barack Obama’s infrastructure stimulus, $850 billion, according to one of his advisers. His team calculates the figure is necessary to create 2.5 million jobs, improve an array of infrastructure projects, and bolster unemployment, health-care, and renewable energy programs, lawmakers told Bloomberg.

China blasted U.S. economic policy yesterday (Thursday) at the Strategic Economic Dialogue, a two-day summit engineered to address long-term issues between the two countries. Chinese authorities have grown more fervent, and more explicit, with their criticism of the U.S. financial system over the past year, evidence of a shift in the balance of power between the nations.