Consumer spending was flat in the US in August. Adam Lass says this zero means more than the much-hyped $700 billion figure currently grabbing the headlines. The bottom line is consumers are running scared, and that is bad news for retailers and manufacturers.

The US economy shrank in the third quarter, says Bloomberg, and “a further contraction is likely in the next two quarters…which would make the recession the longest since 1981-82.”

Eric Fry says his investment strategy is based on a simple formula: “Sell the dollar, sell the dollar and sell the dollar.” And as the buck gets whacked, so will American stocks and bonds. On the other hand, foreign assets and commodities should soar…

It’s inflate or die for Western capitalism,” says The Sovereign Society investment director, Eric Roseman. It may take a while but, according to Eric, Hank Paulson’s attempt to rescue the financial system will send inflation soaring and the US dollar tumbling.

Just how much of your money has the government flung at Wall Street? $1,164 billion so far: $700 billion bailout package for Wall Street; $200 billion for Fannie Mae and Freddie Mac; $150 billion in “stimulus”checks; $85 billion for AIG; $29 billion for Bear Stearns.

Justice Litle says the plan is a minefield for investors. He says there are five things you need to know about the government bailout and what it means for your portfolio.

Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS), the two last major investment banks left standing after the carnage Wall Street, have ended the era of investment banking by changing their status to bank holding companies. The change means the two firms can now create commercial banks that will be able to take deposits.

Have the markets already gone through their inflationary melt up phase? Are they now giving way to debt deflation, in which cash is hoarded and the price of all assets (tangible and otherwise) falls? Well…no.

Much of the recent drop in oil prices is due to the rally in financials, says Byron King. But the black goo is still double the price it was two years ago. Worse still, the US is now coping with chronic inflation. Precious metals are the best way to your savings and purchasing power…

The machinations of the US Federal Reserve are uppermost in the minds of investors — and the media. The Fed is in a jam. On the one side slowing growth and the specter of the credit crisis. Rising inflation on the other.

Are US stocks due for a rally? Don’t count on it, says Rick Pendergraft. More bearish movement is likely. Take steps to protect yourself.

S&P’s/Case-Shiller’s index of housing prices in 20 major US cities fell by a record 15.3% year-on-year in April, the steepest drop since the began collecting data in 2001.