Jobs, Housing to Buying Gold in a Low Dollar Environment

America now has a 10.2% unemployment rate. Ouch. Even though this was expected it was still a shock to see double digit figures, especially when it looked like the economy was on the mend. For many workers in the current generation, this is a definitely an alarming top line figure. What’s worse is that the real unemployment rate (which includes part-timers and the like) is probably even higher. I foresee unemployment reaching 11% mid next year and I hope the economic recovery we are seeing right now stays the course so that more jobs get created.

If you are one of the 10.2% unemployed Americans, there was at least some relief this week with an extension of unemployment benefits. While it won’t solve your longer term problems, it will at least provide some respite over the holiday season. For new home buyers there was also good news with the expected extension of the $8,000 home buyer credit. The credit was also expanded to existing home buyers who want a new place ($6,500 credit now available) and income qualification limits were raised. Unfortunately for me and others who bought a house this year, the updated income provisions are not retroactive and only for homes purchased after November 9th. However, I do that think that in the broader scheme of things, the home buyer credit extension is good for the US economy despite it adding to the deficit.

Another question I get asked a lot, and is the subject of some of my more popular posts, is what’s going to happen with the US dollar and “Should I invest in Gold?” With a falling US dollar which is correlated with rising gold prices (now well past $1000 an Ounce), my advice is to have some exposure to these trends which don’t look like going away but to make sure you still diversify your portfolio. If you want to profit from a falling US dollar then invest in big US multinationals and foreign country ETF’s (I like Brazil based ETF’s now, which I will cover in an upcoming post).

In another update to a previous post on buying a Mac or PC for my next laptop, I just saw some of the upcoming (Black Friday like) deals where Dell and HP laptops with Windows 7 are going for less than $400. This is about one third the price of a Mac, which makes buying a PC very cost-compelling.

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