The American dollar isn’t nearly as strong as it used to be, according to news that came about this week. Because the United States economy doesn’t look particularly promising at the moment, the dollar fell to a brand new low last week. This news, coupled with the fact that oil prices hit their highest points ever, leaves many economists in the United States with many new worries about the economy.

Among the problems with the US economy are the strangely low earnings from Bank of America, the continually slumping labor market, and the already slumping housing numbers. In addition to that, the Federal Reserve released a report on the economy that was anything but promising.
There has been a ton of pressure added to the credit market in recent weeks, as US banks might be looking at liquidation of their securities in the near future. This news also sparked the increased buying of US Treasury bills, which have long been a safe option for investors. This upswing shows that investors are concerned about the market’s direction and want to play it safe during this time.

Tom di Galoma, a chief executive with Jeffries & Co. had this to say in an interview with Yahoo News. “There are concerns about another rout in the credit market. Housing will be a drag on the economy for the next 12 to 18 months.”
There is also speculation among market veterans that another cut in the federal interest rate is coming either this month or the next. Most felt that the Fed would take action before December.

The government bond market also saw the yield on their three-month Treasury bill slip. The bill dropped 23bp to end up at 3.76%. This marked a three-week low. Other Treasury bonds also saw their stock drop in recent weeks, as the market has taken a hit.
The situation isn’t much better in Europe, where the ten year Bund fell by 4.32%. Over in Asia, the ten year Japanese government bond dropped a remarkable 1.64%, which is just one hundredth of a percentage point above the bond’s month low.
Over in the currency markets, the dollar has also seen a drop. It met a record low when compared to a number of different currencies in the last week. The Euro, on the other hand, made a record high number of $1.43 when compared to the dollar. Speculation has it that potential Fed interest rate cuts have played a role in effecting the situation.

Though there are certainly concerns over what to do about the dollar’s sinking value, all signs point to the federal government staying put at this point. All of the reasons for the dollar’s decline seem to be things that will sort themselves out if they are given the chance. Slumping housing numbers and low rate expectations are contributing factors that should eventually cool down as the value of the dollar increases.
As far as metals go, sterling saw a rise in its value this week. It hit a three-month high against the value of the dollar. This came as a result of above average retail sales data in the United Kingdom, where the economy seems to be heading in the opposite direction.
One of the primary concerns for the US economy comes as a result of the rising costs of US crude oil. With tensions in the Middle East continuing to grow, the price of a barrel of oil rose to nearly $90. This is an all-time high that doesn’t seem likely to come down anytime soon. Platinum and gold also look like they are headed into uncharted, record territory.

After the fourth straight week of higher stock prices, investors are flying a little high. Several major companies reported earnings during the week of April 30-May 4 and rumors began circulating of major takeovers. One such takeover includes Microsoft and makes them appear to have an “if you can’t beat them, join them” attitude. This perceived attitude follows Yahoo’s recent announcement to purchase Right Media, which coincidentally follows Google’s purchase of Doubleclick. It is rumored that Doubleclick was originally courted by Microsoft before agreeing to Google’s purchase offer. These Microsoft rumors along with other take over news, helped stocks to rise and end on a high note. While investors are enjoying this bounce in the stock market, several economic and earnings reports are due out this week as well as whether or not the Federal Reserve will adjust the interest rate. On May 9, the Federal Reserve will meet to decide whether to lower, raise, or leave the interest rate alone. The present interest rate has stood still since last summer, but some investors are hoping that the Federal Reserve will cut interest rates in order to encourage spending. While there is hope among investors, many experts believe the Federal Reserve will allow the interest rate to remain where it is.

The reports that came out last week did indicate that the economy is growing at a snail’s pace, but investors are still worried about soaring prices. The other economic reports due out this week will help investors and experts alike, paint a more complete picture of the economy and these reports will without a doubt influence the stock market. On Monday, May 7 at 3:00 pm the Federal Reserve is scheduled to release the March consumer credit report. It is predicted that this report will show consumer credit increased by approximately $2.1 billion dollars since February. Aside from the very busy week that the Federal Reserve obviously will be having, the Commerce department will be having an equally busy week. The Commerce department is expected to report on wholesale inventories, import/export prices, and business inventories. All three reports are predicted to have increases from the previous report, especially the import/export pricing report which is predicted to have a $1.6 billion increase.

Not to be left out of the action, the Labor Department is scheduled to release the Producer Price Index (PPI) on Friday, May 11. The PPI is an indicator of wholesale price inflation. The Labor Department will report on the PPI and the core PPI. The PPI is predicted to have a .7% increase in April while the core PPI, which will ignore the price for food as well as energy, is predicted to have a .2% increase.

While all of these economic reports will have a bearing on the stock market for the upcoming week, so will several major companies who are scheduled to give their earnings report. On Tuesday CVS/Caremark Rx Corporation, the Walt Disney Company and Cisco Systems, Incorporated are scheduled to release their earnings. It is believed that both Disney and Cisco will have promising news concerning their previous quarter’s profits. On Wednesday, Toyota Motor Company will take its turn reporting. It too is expected to have good news for their investors. The dawn of Thursday will see some of the nation’s largest retailers release their sales figures for April. Currently there are few predictions as to what these figures will be.

Basically, the long and short of the market prices is that investors need to hold on tight because while the stock market has seen some growth in the last few weeks, the upcoming economic and earnings reports could make some a little uneasy and therefore make the market falter some this week if not into the next few weeks.

Unless you�ve been living in a cave for the past few years, you�ve probably noticed a huge increase in the interest in poker and in particular, Texas Holdem poker. This boom has occurred online with sites like party poker, on TV with the World Poker Tour and of course the first name in poker: The World Series of poker. The 2005 World Series, was the largest poker event in history. The No Limit Hold�em Final had 5619 entries that generated over $52 million in prize money and $5.2 million in fees and untold publicity to Harrahs. Joseph Hachem, was the winner of $7.5 million grand prize. Overall 45 world series events from June 2nd to July 13th generated roughly $100 million in prize money.

Even more impressive than than the boom in casino poker, is the huge size of the online poker market. It is expected to generate over $3 billion in revenues. At any moment of time, 10�s of thousands of people, mainly males, from all parts of the worlds at rooms including Party Poker, Poker Stars, and others. What�s even more interesting is that most of the money, upto 80% comes from US players; while the US Attorney General (and most state counterparts) have declared online gambling illegal. Unlike casino games or bingo, Poker is considered a game of skill in many state. But we�re not hear to talk about poker or it�s legality, so if you want more on poker and online poker in particular, i found this site helpful All Poker Rooms. In particular you might want to read The rules of Texas Holdem or if you�re like me, and can�t ever remember whether flush beats straights, check out Winning Poker Hands, if you are unfamiliar with the game of Texas Holdem.

Now, that you�ve got the big picture, the real question becomes, what is the impact of poker or more generally gambling on an economy. It was years ago that i heard one TV talking heads, labeled the US culture �the casino economy�. I don�t think their entire theory was exponded in the sound bite, but for me, it was a great description of the stock market/Internet hype bubble that popped in 2000 and the executives that scammed shareholders of Worldcom, Enron, Tyco and many others, steal the jackpot for themselves. This casino mentality has transferred to the current, now slowing, real estate boom. The US culture and economy has become a world of nods and winks, were thieves steel by falsifing info, lying on appraisals and wild conflicts of interest around every corner. While this may not be unique to the USA, it was �The Story� in the US, after the �Internet Bubble� and before the most recent story �Outsourcing�.

In particular, what is the effect of offshore operators, attracting players that might otherwise play locally at state licensed and taxed casinos? Just using the figures (i got them from Marketing Sherpa) the figures i quoted earlier, the online gambling industry is generating $8 billion to $10 billion in revenues each year. Probably drawing away US gamblers who might otherwise play at casinos that pay local taxes. Let�s assume that at least $2 Billion to $3 Billion would have paid taxes in the country where the player live. That�s $10 for every american. Given that the online industry, employs people offshore, it�s really the equivalent of outsource our gambling to lower cost offshore providers. This year alone, rapidly growing India will supply nearly $20 Billion of services for a number countries in wealthier/industrialized world.

I guess my point is that market forces generate an advantage in �Offshoring�, whether it be outsourced-offshore IT services or offshore gambling, because the offshore operator has some combination of cost or regulatory advantage. For IT and Accounting services their advantage is nearly all based on price. Online gambling benefits from both the regulatory advantages of being offshore and the cost advantage being virtual. It is this cost advantage ( being VIRTUAL ) that Las Vegas and the US Indians cannot overcome, without a change in the political climae. While most US business being outsourced is being outsourced based soley on wage differencial, online gambling is being �outsourced� offshore, because the US government refused to allow online gaming or even to allow each state to make it�s choice.

Is there anything wrong with gaming going online or offshore? I�m not really seeking to identify right and wrong, but the same governments that have refused to allow licensed online gambling also lose tax revenues to Offshore/Online operators, every day. So as US gamblers send their money offshore, states lose millions a day in taxes while the US gambling industry loses even more revenue and customers. The best way to stem the tide of online gambling taking money offshore is to all US based/regulated gaming online (each state should decide) and US operators compete with there trusted brands against the offshore operators.

One thing most American�s have not thought about is the effect that Hurricane Katrina can, will and is having on the nation�s airline industry. The skyrocketing gas prices and extreme gas shortages aren�t helping the already struggling industry. Jet fuel, as automobile fuel, has hit a new all time high. Without cheap fuel, airlines are forcing to raise prices and add fuel surcharges onto their tickets, which consumers are not happy about.

Delta for example has been nearing its all-time lows dipping below the $1.00 mark briefly before Friday�s market close. Delta is the nation�s third largest airline carrier; if such an important company is getting hit so hard, imagine all of the others. Already prior to Hurricane Katrina Delta was fighting bankruptcy, no one just has to wonder if it�s a matter of time.

Another big carrier, Northwest Airlines, has already hit their pilots with a big pay cut and is negotiating another. Because of the rising fuel prices and looming pension payouts, Northwest Airlines is the closest it has ever been to filling for bankruptcy. Pilots are working hard to avoid the company needing to file for Chapter 11 � if this is done all of their pensions will die.

These 2 large airline companies are fighting a tough battle to avoid bankruptcy and Hurricane Katrina only made it harder for them. This is just another example of how devastating the hurricane has been on our nation and our economy.

Hurricane Katrina (at the time of publishing) has not even passed the half-way mark on its attack on New Orleans, LA. After roughly 45 minutes of an open market we can already see the effects which it is having on the economy.

Already the prices for crude oil have gone up over $3.00 per barrel and have broken the $70.00 mark. This is due to the number of off-shore oil platforms in the Gulf of Mexico which drain hundreds of thousands of barrels of oil from deep under the soft sandy bottom of the gulf. At this point damage to these off-shore oil platforms is unknown. We can only hope it is minimal as to void another spike in oil prices.

Additionally the reported on-shore damage to the Louisiana and Alabama area is expected to be astounding. The area�s leading insurance companies, State Farm Insurance and St. Joseph�s should be very active stocks in the coming days. Estimates are in and experts are predicting nearly $25 billion in insurance expenses for Hurricane Katrina.

Other active stocks to watch should be for home improvement centers as people will eventually return to their homes and start the clean up, repair and rebuild process after the disaster. Favorites to watch are Home Depot (HD) and Lowe�s Home Improvement (LOW).

For more information on the effect of Hurricane Katrina on Insurance companies, and damage estimates, check out the following:
http://news.moneycentral.msn.com/provider/providerarticle.asp?feed=OBR&Date=20050829&ID=5068935