The S&P 500 Index continued its downward trending Monday,closing down 29.82,or 1.56%.This was based on the decline of light sweet crude below the 30.00 mark,down 2.42% to 29.77 a barrel.Brent crude fell even harder,down 6.62%,but didn't crack the 30.00 threshold,closing at 30.05.Safe havens gold and silver both appreciated,with gold closing at 1108.8 an ounce,up 1.1%;and silver closing at 14.255 an ounce,up 1.444%.*
There is a lot of concern in the markets over the devaluation in China and the collapse of oil,said Bob Baur of Principal Global Investors.We think a huge devaluation is not ahead.I think China is more interested in a stable currency rather than devaluation.We're finally seeing some stability in the commodity markets.We do think 30.00 is low for oil prices.*
Overall,we're not seeing the kind of consumer spending we were expecting.Lending is going up,but consumers are still reducing their spending.China has slowed dramatically,so there's a real concern about growth slowing.There's an awful lot of worry about a global recession.We think growth is being rebalanced.We are in a place where growth is not going to be what it was.The engine is there-it's just not going to be what we're used to.*
We've recapitalised the banks.Private and household debt has come down.Private debt has come down since 2005.*
Australia is doing remarkably well.The job growth there is good.The US economy has been resilient.Consumer spending is robust.It's awfully hard to see a recession occurring there,Mr.Baur noted.*
In the short-term,we could see some short-term rebound;but long-term,we are still bearish over the next 12 months,cautioned Jason Low,equity strategist at DBS Private Bank.*
Market Vectors Gold Miners ETF (GDX),Silver Wheaton Corp (SLW)
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