The 66% Solution

The title here is a simple take-off on an interesting, un-related article posted here recently by Roger Nusbaum, but it relates to an important reality in today's market.

If you're surprised at today's percolating talk about the Fed now actually cutting rates, don't be: Fed Funds futures currently suggest a 66% probability that Bernanke and Co. will indeed cut rates by 25 bps at tomorrow's meeting.

What a reversal from a few weeks ago, when the market was pricing in a rate hike by year-end as a near certainty!

I recently wrote how gold could plunge toward $700 based on its set-up. It could still happen, but you can probably throw that right out if we do indeed get an interest rate cut tomorrow.

The U.S. dollar could continue to hold up as a safe haven vs. other currencies for a while, but you have to like gold's chances in a nutty environment like this, where our fearless leaders in Washington, D.C. put taxpayers on the hook for more and more problems on a near-daily basis.  Good grief.

Silver's probably worth a look, too... consider SLV in here.