Financial education is key..

So I posted a previous entry about the gold prices perhaps rising in 2009...I admit that it may not be the safe haven that investors are saying should be flocked to against a falling dollar. I think most of the speculators concluded that since the government was going to be printing money, and gold should rise. However, the forces of deflation have caused the price of most commodities to go down...including gold. Furthermore, I've been learning about the Elliott Wave method and gold is set to go down....apparently to the $600-$650 mark.

That being said, if prices are going down in a deflationary period and if we are supposed to see another big crash in March 2009, I gather cash is king??

Daus

Marketwatch's David Callaway believes the real fireworks show is about to start, and he links recovery prospects in large measure to oil values:

"Everybody should have known the holidays would only delay it. The freight train of job cuts, plunging earnings and massive spending cutbacks set to hit the economy was, thankfully, pushed back a few weeks while stunned investors and workers across the globe caught their breath after the worst fourth quarter in decades.

But now the great dying has begun, and I'm not talking about German billionaires throwing themselves in front of trains or French aristocrats slitting their wrists, as alarming as these incidents have been. No, earnings season, the time for companies to 'fess up just how bad it's been for them in the last three months, is here.

A rally since late November in the markets gave hope that equity investors, a forward-looking indicator, may see the bottom for the economy in the first half of this year.

That may still be true, but we still have to get there. And the next few weeks of earnings warnings and then actual earnings, along with outlooks for the next three months, are expected to be littered with bad news. It's not just layoffs and plant closings, which are bad enough on hard-working folks and the surrounding economy. And it's not just bank failures, or collapsing investment banks and hedge funds.

Companies will start going completely out of business, including retail firms, biotech companies, and many, many mom-and-pops out there in everything from auto parts to bars and restaurants. Much of it will be tied to consumers pulling in their horns. They were willing to buy the Christmas tree or the holiday trip to grandma's house. But now that we're in January, getting more exercise is no longer on the top of the annual resolutions list.

Investors won't be safe either, especially with time bombs like Wednesday's fraud at India's Satyam Computer Services going off with alarming frequency, causing its shares to fall almost 80%. This is the time in the cycle where all the frauds come out -- Enron, Worldcom, Madoff. They're all exposed when the tide goes out.

You think Ken Lay isn't chuckling on some cloud somewhere about all this? Is it a coincidence that Jeff Skilling was back in the news this week? Already somebody is calling Satyam India's Enron. There will be more to come. So what will signal the turning point? Could it come during the worst of earnings season? Perhaps. But I expect it will come afterward, and that it will be tied to oil prices.

The collapse of the oil bubble was stunning in its ferocity, equally if not more stunning than the rapid inflation of the bubble itself. Likewise, crude is now oversold and while it looks set to fall below $40 a barrel and maybe well into the 30s, investors will flock back to it at the first sign of an economic rebound. That will in turn spark energy stocks, and probably financial stocks, and we'll be off to the races again.

Obama's inauguration and the swift passage of his economic stimulus package will provide some gauze for the wounded markets, but there is still too much to work through to think the passing of the torch will be the catalyst.

In the meantime, financial advisers will continue to recommend the old saw that the best position for investors is indeed the fetal position, and asset managers sitting on cash and low-yielding bonds will be awaiting any sort of signal that the worst of the actual economic pain is over. When the economy does get ready to turn, the markets will react quickly. But it isn't there yet."