Oil will breach $ 100 a barrell within the next few days which will increase gas prices in the US and add to transport costs of everything, from food to toothpaste. The dollar is dropping to new lows against most currencies which should increase the price of imports. Meanwhile more people are finding jobs because of increase in exports and booming tourism. This should cause inflation but the Fed cut rates for the second time and has pumped more than forty billion dollars to relieve the credit crunch. Seems that they believe that recession is a bigger possiblity than inflation. Maybe that money is coming to the east because markets here are jumping from one record to another. Mumbai, Shanghai, Hong Kong all appreciating like mad. China Oil has become a trillion dollar company on listing after its IPO. Ali Baba dot com, also a Chinese company, is at 130 its projected earnings. Meanwhile Merrill Lynch have lost nearly eight billion dollars as have Citi Bank on subprime mortgages. General Motors have lost a mind boggling 36 billion dollars in the mortgage market. No one knows what the final bill is going to be and what effect it will have. Speculators and hedge funds move vast billions at the speed of wire transfer and globalisation has removed any controls that governments used to have. In this morning's paper it says that more than ten billion dollars have been invested in Indian stocks through PNs ( Participatory Notes ) which are use by anonymous investors. Some people fear this is terrorist money being laundered through the Indian stock market or it could be drug money. No one knows. No doubt it is hot money and could vanish overnight. Meanwhile ministers are smiling at the phantom market capitalisation of Indian companies. No controls and no one knows. Frightening way to run the world. A very happy Diwali to all my fellow citizens of the world.