I know this seems redundant, but Europe continues to capture headlines as they struggle to agree on how to deal with this crisis of confidence.

It appears that Greece will receive the next round of bailouts (transfer risk from private banks to taxpayers) funds, despite missing deficit targets. Originally, they were talking about the private banks, pension funds and other financial institutions taking a 21% loss. The talk now is about a 50% loss and the balance of the loss to be born by the taxpayer. As you can imagine, this is meeting resistance from the banking system, but they should not worry, because along with that haircut the talk is of bank recapitalization, and the taxpayers will foot that bill as well. No wonder “Occupy Wall Street” is spreading globally.

In Italy, while Berlusconi did get his vote of confidence, investors dumped Italian debt even after the ECB began buying it on Aug. 8 to stem surging borrowing costs after a massive austerity package was passed.

Slovakia, the final country needed to approve expansion of the EFSF (European bailout fund) after a collapse of the current government. The former head of the Slovakian government, Sulik said “I’d rather be a pariah in Brussels than have to feel ashamed before my children.” Wow, a politician I’m proud of!

A group led by George Soros, have written a letter urging euro area countries to move towards political union. After all, it is easier for 1 group to agree than 27, which is the current requirement. If they did indeed push something like this through, citizens from individual countries would lose their voice.

Standard & Poor downgraded Spain’s debt, which was the third time in as many years, though it was recently downgraded by Fitch. In more downgrading news UBS, Lloyds Banking Group Plc and RBS were downgraded by Fitch, which put more than a dozen other lenders on negative watch as part of a global review.

Treasury Secretary, Tim Geithner told CNBC that the IMF has “very substantial” resources to fund a device similar to the TARP program taxpayers funded here in 2008. He also said, “Through the IMF, of course, we’re already playing a very major role.” This is because we give taxpayer money to the IMF.

China’s exports fell more than expected as they feel the global economic stresses of their two biggest trading partners, the US and the EU. At the same time, the Senate passes a bill aimed punishing China for currency manipulation, a move Beijing slammed as a “time-bomb” that could start a trade war. Personally I find this funny since every single country is purposely debasing their currency, including the US.

On Tuesday the Senate Republicans voted down President Obama’s jobs package, opposing more stimulus spending and an increase in taxes. But for the first time since 2007, there was bipartisan approval on foreign trade agreements with South Korea, Colombia and Panama, with the hope of creating jobs here in the US.

Municipalities continue to feel the economic squeeze as revenues fall because of unemployment, foreclosures and reduced Federal funding. In the latest bankruptcy filing Pennsylvania’s capital, Harrisburg is now the nation’s highest profile municipality to admit that it can no longer handle its debt.

Nationwide, foreclosure filings totaled 610,337 in the third quarter, said RealtyTrac, an online marketplace for foreclosed properties. The time it takes to process foreclosures rose to an average of 336 days to complete.

With all of this negative economic experience it is no wonder that US consumer sentiment slumped in October as declining incomes drove consumer expectations to the lowest level in more than 30 years, and yet many on Wall Street still seem annoyed at the Occupy Wall Street movement that continues to grow. While many cities in the US are now participating in the movement, tomorrow it will go trans-continental as thousands of people are expected to gather near London’s Stock Exchange. But economic unrest continues all over the world with more and more citizen’s taking to the streets to protest what they see as unfair government policies. The truth is that this has been coming for many years and is the normal evolution of a debt based currency system that robs the workers and savers in a transfer of wealth to the debt creators. Follow this link to read more http://www.cnbc.com/id/44875458

Let’s see how all of this news impacted the markets this week. The chart below shows you the DJIA, which started the week at 11,103.12 and ended at 11,644.49. So this was a pretty good week for stocks which were up almost 5%. The market really seems to like talk of bailouts. There is resistance at 11,760 and since the 50 day moving average remains below the 200 day moving average, the DJIA remains bearish (negative), continuing to make lower highs.

Has the dollar’s rally come to an end? Starting the week at 78.63 and closing at 77.00, the dollar was unable to break above resistance and falling 2% on the week. It is sitting on a bottom support level and if that level is broken, it is most likely to test that next level down. Since the 50 day moving average is slightly above the 200 day moving average, we have to see if it can hold and expand that position. I’ll keep you posted, but my guess is no. Of course much depends on what happens in Europe next week.

Spot gold started the week at $1,642.50 and closed the week at $1,683.00 for a 2.5 % gain on the week. This was the strongest weekly gain in a month and brought some bullion inventory back onto the market. My wholesalers tell me that most gold and silver bullion coins are still 1 to 3 weeks out for delivery.  In the numismatic world, the coins remained steady this week; I will publish the new chart as soon as they make it available.

As you can see in the chart below gold is testing a resistance level on top, so we could see a breakout next week. I’ll keep you posted.

The Relative Performance chart below shows us that this week the wealth shifted out of Bonds and the Dollar and into Stocks and Gold.

You should know that we do these wrap ups to help you understand what is happening in the markets. If you have any questions, please call your ITM representative or email us. This is the time to pay attention and we are happy to help you do that.