While investors remain extremely concerned about the volatility of the U.S. stock market, the weakness of the American economy and the uncertainty of the global financial markets, last week brought “slight” relief from the excessive panic of the eight-trading-session losing streak.

Congressional negotiators late yesterday reached a tentative agreement on a credit-crisis compromise. It gives the Bush administration about a third of the $700 billion it has requested up front but made sure half that outlay was subject to a congressional veto, reports William Patalon III.

Not so very long ago, I published here a photo of an honest-to-goodness bank run in England, as depositors tapped politely at the door of Northern Rock Bank in the hopes of receiving their money back.

British readers may see parallels between the collapse of US lender IndyMac (NYSE:IMB) and Britain’s Northern Rock (PINK:NHRKF), which failed last September.

Commodity Trend Alert editor Eric Roseman is issuing a stark warning: Your bank could be next.

If you have money in the US banking system, he recommends you put it instead in Treasury bills or exchange traded funds (ETFs) that invest in short-term Treasury securities like SHV or SHY.

The US economy is on the skids, says Bill Bonner. Wall Street banks made their money by peddling debt to people who already had too much. And that couldn’t go one forever.

The global financial system is falling apart, and the world economy is slowing down. American consumerism is also slowing down – and no one knows what to make of that.

What would happen if Ben Bernanke actually gave it to Americans straight? At the moment, says Bill, the truth is the last thing anyone wants to hear – but they’ll have to face up to it sometime.

Both gold and silver were under pressure right from the Sydney open early yesterday morning in Far East trading. The prices bottomed just after midnight last night New York time. The gains from a feeble rally in gold and silver during London trading disappeared in the last two hours leading up to the NY open.

Gold pushed higher through the first hour of the New York session yesterday, peaking at $981, but then ran into some determined selling that sent it spiraling downward into the Globex, where it flatlined to finish at $959.30/oz., down $17.90. Overnight, gold has fallen further.

Platinum’s long slide was prolonged for another day, as the metal skidded from the last hour of NYMEX trading through the Globex to end at $1900/oz., down $60. Overnight, platinum has been flat.

Silver remained above $19 through the mid-morning hours, but faded from there, closing at $18.76/oz., down 13 cents. Overnight, silver is little changed.
(Click here for charts)

The precious metals took a trip south, as would have been expected as the usual suspects lined up uniformly…

How the current financial crisis was born in the 1970s. Whether it’s Northern Rock (NHRKF), Fannie Mae (FNM), Freddie Mac (FRE), Indy Mac (IMB), the Labour Government, the State of California, or whoever is going to run into trouble next week, the sirens are blaring, ‘global financial emergency’.

Since the free market didn’t turn out so well, now it’s time for ‘adult supervision,’ says Bill Bonner in The Daily Reckoning.

When Fannie Mae (FNM) and Freddie Mac (FRE) had the wind at their backs they were considered part of the ‘free enterprise’ sector. Their CEOs received pay hikes as the companies laid the groundwork for their own undoing.

Now the mortgage firms’ fortunes have changed the American taxpayer discovers that these were ‘government sponsored enterprises’ all along. They were part of America’s welfare system. And now they’re getting the dig out they always knew would be forthcoming…

In a rare press conference yesterday President Bush tried to assure Americans that their banking system was “sound.”

Bush’s comments didn’t do much for investors confidence. Shares in troubled mortgage outfits Fannie Mae and Freddie Mac tumbled, along with most other financial stocks.

The bottom line is the U.S. financial system is now beyond credibility, as James Howard Kunstler puts it. And Dubya and his Republican party will be remembered as the party that broke America.