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 The market shrugged off China’s sell-off yesterday and closed at record highs. The S&P 500 finished just over 1,530 -- 3 points higher than its March 2000 peak. The S&P 500 has nearly doubled in value since 2002. But… the last time it went this high, it lost 50% of its value in less than two years.
 The Dow also reached a record high… for the 25th time in 2007.
 “The correction of the housing sector is likely to continue to weigh heavily on economic activity through most of this year,'' the Fed said in yesterday’s release of its May 9 meeting minutes… “somewhat longer than previously expected,'' The Fed admitted.
“Hmmm… ‘somewhat longer than previously expected,’” Mish wondered, “or orders of magnitude longer than expected? Perhaps we can find a clue in the words ‘weigh heavily,’” suggested Mike Shedlock of The Survival Report.
“It was just a few months ago that Toll Brothers was ‘dancing above the bottom’ and the Fed was saying housing would pick up in the second half. Now, almost out of the blue, the Fed has started chirping a different tune.”
You can read Mish’s report on The Second Wave of the Housing Tsunami here:
 “Admitting its [The Fed’s] ignorance of the housing situation should have taken the dollar to the woodshed,” commented Chuck Butler this morning. Instead, the dollar hit a seven-week high against the euro, at $1.34.
“A currency that gets no love from the Treasury Department, or the administration, now has a central bank with a credibility problem! Geez, Louise, when are these dollar buyers going to wake up and smell the coffee?”
 Yesterday, we reported the average working stiff’s share of the U.S. public debt has reached $516,348. “Put that together with his spiffy new mortgage,” comments Bill Bonner, “and he's more than $1 million in debt. He has taken what Friedrich Hayek called 'The Road to Serfdom.’ He is becoming a slave… to his credit cards, to his government, to his mortgage, to his nation's foreign meddling and domestic commitments; and the poor man has no way out.”
After adjusting for inflation, the average 30-year-old man today makes $35,000, while his father brought him $40,000 in 1974. These paltry numbers were released by Pew Charitable Trusts yesterday.
 Not long after we told you about Gunner's bid on small beverage companies as “buyout bait” yesterday, Citigroup upgraded Coca-Cola, which has recently been buying up niche soda small caps, from hold to buy. Think someone in the bank is reading The 5?
 India’s stock market hit $1 trillion earlier this week. “India joined the list of countries with trillion-dollar stock markets, passing another milestone in its 16-year transition from socialist backwater to the first rank of the world’s major free market economies,” commented the Financial Times.
“This is indeed a historic milestone,” adds Capital & Crisis’ Chris Mayer, “but also one with practical implications. A deeper capital market makes it easier for India to finance investment in the country.” Chris has his eye on India’s dire need for infrastructure, which, it’s estimated, will cost more than $320 billion over the next five years.
“There are many neat Indian companies involved in infrastructure,” says Mayer. “Although they’re somewhat hard to buy. The biggest are...
Jaiprakash Associates; Hindustan Construction; Nagarjuna Construction -- all three are in roads, bridges, tunnels, etc. There are some cool engineering companies too, like Larsen & Toubro or Bharat Heavy Electricals.
“I don't think the time is quite right for a pure play India idea right now. The market is a bit frothy. But the backdoor stuff is good.” For the right time to buy, make sure you’re a subscriber to his newsletter, Capital & Crisis:
See: Blood Money! Vultures Dive In…
Also, if you’re really interested in India, you can join me, Chris and Karim Rahemtulla of Mt. Vernon Publishing on an Asian Tigers Investment Tour of India in October. We’ll be touring potential investments, talking to business and political luminaries and doing our best to take in the cultural delights India has to offer. There are a few limited spots still available. Grab a couple. Details here:
Asian Tiger Investment Tour of India
 “Forget the USDA reports!” writes Kevin Kerr from the front lines of the ethanol boom. “The corn crops here in northern Wisconsin and Upper Michigan are basically rotten. One farmer told me, ‘We don't even go in and report to the USDA. It’s a waste of time.’"
 “Forget the tortilla crisis… no agave, no tequila... mucho problemo!” continued our Maniac Trader. Many Mexican farmers are literally igniting their blue agave fields and sowing the land for corn. U.S. demand has pushed prices high enough to pull agave farmers right out of the industry.
“The switch to corn will contribute to an expected scarcity of agave in coming years, with officials predicting that farmers will plant between 25-35% less agave this year to turn the land over to corn,” reported Reuters.
And we’ve heard rumors that barley growers in Germany have switched to rapeseed -- or canola, if you prefer its more hygienic moniker -- for use in biodiesel. The knock-on effect is rising beer prices, which is practically a sin in that country.
No tequila in Mexico… beer prices skyrocketing in Germany… oh la la, this is getting serious.
 “What's this U.S. dollar bashing all about?” asked a loyal reader. “If you had an old house on your property that was going to get torn down soon, to make room for a new one, tell me, would you renovate that house, or repaint? No, you would even stop the normal upkeep and maintenance. Why waste any more money? Save it, to help build the new one. And would you care if your neighbors complained about the poor shape your old house was in?
“Nah.
“Same with the U.S. dollar, right? And all the foreigners holding dollars? They will need to start over -- amassing the new amero. And Americans? No foreign debt anymore. Ingenious, if you ask me.”
 “Much of the world is operating in a noncustomer-friendly environment for the dollar,” opined one reader. “The booing at Miss Universe and the threats of nonmoderate Islamic and South American thugs have become pervasive…
“The dollar will hold up and strengthen because it is not in the interest of anyone for it to fall. While I consider debt to be insane in any form, maybe because of it, the major powers have no choice but to support the dollar. The collapse of all major currencies against gold is the only issue. This will most certainly happen as all the major central bankers play musical chairs with each other.
“And probably on a five-year time frame… about the time the baby boomers stop spending, and the government goes nuts printing money to pay the Social Security checks and try to keep unemployment out of the 20% range, an ounce of gold should yield about $2,000, or the equivalent, in any other currency playing in concert with one another.”
Amen to that brother,
Addison Wiggin
P.S. “There are maybe a handful of tiny, tiny points on which I disagree with Ron Paul,” writes a reader and confidante, “but goddamn, the only reason this guy will never get elected -- and I'm not sure he expects to be -- is because he's one of the few, maybe the only, in D.C. who has the -- pardon the expression -- nads to put the truth in the face of these imbeciles, both the neocons and the Murdoch's media lackeys.
“In a true free election with equal airtime for all the candidates, and not just the ones backed by fat-wallet special interest, Paul would have a chance. Too bad we don't have free elections anymore.”
Ron Paul on Cavuto
Watch the video. Send it to your friends.
P.P.S. Just wanted to make you aware. From time to time, we open up the Agora Financial Reserve to new Membership. Reserve Members, if you don’t know, receive all Agora Financial publications for a one-time upfront fee and a small annual maintenance charge. It’s a great deal. And it only gets better as we add new writers and products to the roster.
If you like what you’re reading in this forecast and you’d like to take advantage of the most inexpensive way to activate our all-star contributors’ advice for your portfolio…
Stay tuned… Our next AF Reserve Membership drive will begin tomorrow.
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While working with Citigroup in Hong Kong,
