We had the internet bubble and the real estate bubble and now, there is the ethanol bubble. Recently, I ran some numbers on ethanol and to my amazement realized that it is - too use a catch phrase from the environmental world -- not sustainable. Turning food into fuel is just plain silly; and when oil prices come down the ethanol bubble could pop big.

I ran did a little research and found some numbers:

• 47% of the Mexician' diet is corn
• it takes 2.4 pounds of corn a day to feed a hungry person
• it takes 22 pounds of corn to make one gallon of ethanol
• there are 42 gallons of refined gas in one barrel of oil

If you fill up with ethanol, every time you pull that SUV into the gas station and pump 22 gallons, you starve a poor person for six months. Another way to look at a barrel of oil is that it has enough energy to feed a person for the entire year. Using that logic, the much debated Arctic National Wildlife Refuge -- with at least 3.2 billion barrels of oil -- contains enough food to feed the entire world for six months. If you think my estimates are wrong, you're right; the real math is actually worse.

So what does that mean for investors? When the public and politicians own up to the fact that food for fuel causes world food prices to rise and starve the poor, all those companies currently flying high on ethanol could come crashing to earth. A few of the companies that have been running on the recent ethanol excitement include Monsanto (NYSE: MON), Potash (NYSE: POT), Mosaic (NYSE: MOS), John Deere (NYSE: DE), Archer-Daniels-Midland (NYSE: ADM) and Bunge (NYSE: BG).

Kevin Kersten is an Stock and Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and/or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

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In the agricultural sector, it's been nirvana for investors. But are prices too high?

Perhaps not. Take Bunge Ltd. (NYSE: BG), which is a major fertilizer and oilseed producer. Bunge has agreed to pay $4.4 billion for Corn Products International Inc. (NYSE: CPO), a producer of finished corn products. Some of its customers include biggies like Coca-Cola (NYSE: KO). This is a stock-for-stock deal. In other words, why not take advantage of the high market caps?

Both companies have rich histories. Corn Products got its start in 1906 and Bunge was founded in 1818. But it's the future that matters, and Bunge is certainly bullish on the global growth trends in the agricultural markets. To take advantage of this, it makes sense to bulk up. Corn Products will expand Bunge's offerings as well as provide some diversification.

In fact, Bunge also raised its full-year 2008 earnings forecast from $7.10-$7.40 to $9.35-$9.65. This doesn't even include the impact of the Corn Products transaction.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

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BCE (NYSE:BCE) is up 11% on news that a Canadian court has cleared its LBO.

Bunge (NYSE:BG) is up about 3% on news it will buy Corn Products (NYSE:CPO).

Motorola (NYSE:MOT) is down 3% on news of an analyst downgrade.

Corning (NYSE:GLW) is up 2% on its prediction that its LCD glass sales were strong.

Stocks may trade differently in the pre-market than they do in the regular session.

Douglas A. McIntyre is an editor at 247wallst.com.

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The stock market is in turmoil today and the reasons can be found elsewhere (including in some peoples' imaginations). But if you are a bottom line investor, then here is where you should be looking. Food and energy exploration are the places to be.

Things can change rapidly, but as of right now food related stocks like Bunge Ltd. (NYSE: BG), the largest company involved with soy based products, and Potash Corp. of Saskatchewan (NYSE: POT), the largest fertilizer company, are up.

In the exploration sector, Anadarko Petroleum (NYSE: APC), the oil, gas and exploration company, Loews Corporation (NYSE: LTR), which is the majority shareholder in Diamond Offshore Drilling and is separating from its tobacco interests, and Precision Drilling TR (NYSE: PDS), the Canadian contract driller that is expanding into the lower 48 states, are all up.

All five stocks have out performed the market this year and that trend does not seem to be in jeopardy yet.

I will update this post with final results after the market close to see how the story ends.

UPDATE: four of the five closed in positive territory when all the major indices were in the red.

• APC finished down to $77.69, -0.54 (-0.69%)
• BG finished up to $122.40, +0.47 (+0.39%)
• LTR finished up to $48.95, +0.45 (+0.93%)
• PDS finished up to $26.95, +0.49 (+1.85%)
• POT finished up to $223.10 +2.54 (+1.15%)

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of APC and PDS.

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After five months of tracking my 2008 picks, it is rewarding to finally have a breakthrough -- topping the three major stock indices and Berkshire Hathaway (NYSE: BRK.B) too. It has been painful to have to report each month that I was being bested. However, since I have not seen anything contradicting my original rationale for my eight picks I stood my ground.

This past month saw great improvement. For the first time since I posted the original story Chasing Value: Final list -- 8 stocks for 2008, five of the eight stocks are up:

Moving into positive territory by pennies was Loews Corporation (NYSE: LTR). Among its holdings is a 51% stake in Diamond Offshore Drilling, Inc. (NYSE: DO) that has been doing well as the world remains desperate for more oil and natural gas.

Bunge Limited (NYSE: BG) was the other stock to cross the line into the black, while Valero Energy Corp. (NYSE: VLO), although improving, remains my worst performer. It is still down almost 28% after five months.

The gap between the Dow Jones Industrial Average, Standard & Poor's 500 Index and the technology heavy NASDAQ Composite Index narrowed substantially so that the three are tracking each other very closely. Stocks like Apple, Inc (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG) continue to gain significantly and their outlooks have not been shaken amid overall pessimistic economic forecasts.

Most of my picks improved. Last month's three winners stayed on track with continued higher energy and commodity prices along with the war. Raytheon Co. (NYSE: RTN), the high tech defense contractor, Reliance Steel & Aluminum (NYSE: RS) and Anglo American plc (ADR) (NASDAQ: AAUK) do not show any signs of wavering. All three continue to be mentioned in M&A conversations with RTN on the buying side, AAUK on the selling side and RS on both.

In January, I added Newcastle Investment Corp. (NYSE: NCT) and Huaneng Power (NYSE: HNP) to my holdings. In April, as HNP hit new lows, I acquired more stock, happy to collect the 5.6% dividend yield. I did not add anything in May.

Through May, the average return for the eight picks amounted to a loss of -3.36%; a major improvement from last month's -8.96% or March's -15.96% depressing lows. This outperformed the average return of the indices: -5.47%. This year's stalking horse, Berkshire Hathaway (NYSE: BRK.B), while gaining a little during May and still besting all the indices, is down -4% for the first five months. I can't remember the last time I was ahead of 'my pal Warren' -- oooh, maybe I'm learning something!

I am Including dividends for my picks, that averaged an overall 3.91% yield through the first quarter. However, this is being adjusted because of NCT's reduced dividend to 2.99% going forward. Therefore, I will be adding 0.978% for the first three months and 0.249% (2.99% / 12) for each additional month. Through May, the loss was -3.36 + 0.978 + 0.498 = -1.88%. Using 1.8% for the average dividend of the indices times 5/12 adds 0.75%, and reduces the loss to -4.72%.

After five months I have overtaken all of the indices and BRK.B, to my surprise, even without the help of the dividends . BRK.B does not pay a dividend.

I continue to hope that 2008 does not end up being about who loses the least. The following are my eight picks with the starting share price as of December 28, 2007:

• Anglo American plc (ADR) (NASDAQ: AAUK) from $30.79 is Up to $34.28 for a gain of 11.33%.
• Bunge Limited (NYSE: BG) from $119.03 is Up to $119.37 for a gain of 0.29%.
• Huaneng Power International (ADR) (NYSE: HNP) from $41.75 is down to $33.74 for a loss of -19.19%.
• Loews Corporation (NYSE: LTR) from $49.35 is Up to $49.57 for a gain of 0.45%.
• Newcastle Investment Corp. (NYSE: NCT) from $13.08 is down to $9.92 for a loss of -24.16%.
• Raytheon Company (NYSE: RTN) from$61.51 is UP to $63.86 for a gain of +3.82%.
• Reliance Steel & Aluminum (NYSE: RS) from $54.32 is Up to $67.97 for a gain of +25.13%.
• Valero Energy Corporation (NYSE: VLO) from $70.55 is down to $50.84 for a loss of -27.94%.

The Indices:

• Dow Jones Industrial Average: 13,365.87 dropped to 12,638.32 for a loss -5.44%
• NASDAQ Composite Index: 2,674.46 dropped to 2,674.46 for a loss -5.68%
• Standard & Poor's 500 Index: 1,478.49 dropped to 1,400.38 for a loss -5.28%

This year's "stalking horse" Berkshire Hathaway (NYSE: BRK.B) (I am tracking the 'B' shares, not the more expensive 'A' shares) saw its B shares down from $4,685 to $4,498 for a loss of -4.0%.

After our Federal Reserve Chairman Ben Bernanke announced a cut in the discount rate of a quarter point to 2% last month, he changed his stance and intimated it would probably be the last cut. Now we are hearing noise there actually could be a raise in the rate depending on inflation fears. The market seems to believe that story in the long term, but not the short term one.

I still think investors should be looking at the defense sector Chasing Value: General Dynamics & Raytheon: The defense does not rest.

May Recap:

• 2008 picks: -1.88%
• BRK.B: -4.0%
• Major Indices: -4.72%

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. DISCLOSURE: I currently own shares of AAUK, BRK.B, HNP, NCT, and VLO.

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I have not decided who I am voting for yet. Or maybe it would be more accurate to say I have decided on multiple occasions only to become undecided again. While some will see me as fickle, or worse, others may be in the same boat.

I am also continuing to think about what difference any of the candidates can make on the economy, and based on these musings, where to invest. My current belief is that none of them will have a profound impact on our economy.

There are no financial wizards among them. Here is the shocker though: I like all three candidates, or at least can find some good in each of them. Each of them is a fighter, and I believe each one of them brings certain skill sets to the job. There are also things about each candidate that are inescapably negative. Clinton has so much baggage, Zsa Zsa Gabor would be jealous. Obama does not have the experience and he has a degree of arrogance (right sweetie); McCain is an old stick-in-the-mud who, as a long-time senator, has spent more hours with lobbyists than almost anybody, though he is pretending otherwise.

Where does this leave me from an investment perspective? My first choice, for stability with moderate growth and dividends, remains the defense sector. I wrote Defense sector rolls over S&P 500 for 8th straight year a while back and I still think that it is the most secure. Here's why:

A) None of the candidates will want to appear soft on defense when we are at war, and all three have made threatening remarks in some country's direction to make sure the electorate knows that.

B) The War in Afghanistan and Iraq rages on, and even the most optimist view is that a draw-down will take years.

C) Even if all war ceased immediately, the upgrading and replenishment of the hardware will cost billions of dollars and most of the defense contractors have that in their backlogs now. Chasing Value: General Dynamics & Raytheon -- The defense does not rest

Mike Huckabee made news by suggesting he would be delighted to pair up with John McCain as his VP running mate. He is another guy that has a real hunger to be heard, but has no interest in a real job. While this may strengthen the party ticket, shoring up conservative support, historically successful candidates move to the center in the general election. Huckabee would lose him as many votes as he would gain.

Nobody is more hungry to be president then Hillary Clinton, who may view this go-around as her one shot at the oval office, since the next occupant could be there eight years if they don't screw up too bad (right Dubya).

Hillary Clinton is doing some big time pandering to stay in the presidential race, and does not look like she has lost any of her fight yet. She seems to be the most polarizing of the three candidates, because there are many that simply do not trust her. Oddly, if this were any other type of race, trust might not be an issue, just success -- and an argument could be made that she might be the most successful. For all her husband's problems in office, the economy was humming and legislation was moving.

There are a growing number of hungry folk -- the continuous rise in food prices has supported one of my thesis from last December Serious Money: ADM, Bunge, Potash Corp. -- it's a hungry world and I expect, like the defense sector this is still a smart place to be investing, although these three stocks are on the pricey side. However, who is to say they have topped out. Archer-Daniels-Midland (NYSE: ADM), Bunge Ltd. (NYSE: BG) and Potash Corp. of Saskatchewan (NYSE: POT) dominate a major portion of he world market in grains, oils and fertilizers.

A) Our sinking dollar makes our prices on the world market more competitive.

B) China, Russia, India, Brazil -- the whole world for that matter have been adding more meat to their diets and that is raising the price of everything. The number of capitalists has doubled!

C) Diets will change in tough economic times, but food will remain a higher priority than most everything else.

Looking beyond the economics of guns and butter for other themes and hearing every day the drum beat that change is afoot, I wonder where else things might remain stable or grow. What comes to mind is power, and I have thought this for quite some time -- Serious Money: Electric utilities are the place to be. I still like the Southeast U.S. and own stock in Duke Energy (NYSE: DUK) and the Southern Company (NYSE: SO) for the long haul.

A) Power companies will be open for business every day of the year and pay solid dividends.

B) Even if housing is down and foreclosures are increasing, someone will own the homes and they will still need the power company.

C) The increase in consumer products requiring power, and the movement toward electric vehicles, will increase demand.

Speaking of a newcomer that seeks power -- Barack Obama promotes himself as the candidate of change. I ask, CHANGE WHAT? Does he think he can become more touchy-feely, like Jimmy Carter, and make nice to everyone? That did not work. He wants to bring us all together, but that's not going to happen. Some folks want to eliminate capital gains taxes and others want to raise them; some want to stop all abortions and others want a women to have a right to choose; and some want health care coverage to be provided by the private sector and others want the government to take over. There will have to be a compromise, but there will be a battle royale to get there.

The Democrats are happy to run against Bush, because even many Republicans would not like to do the Bush economy over again and economics does not seem to be McCain's strong suit anyway. If Obama is the survivor of the political process ("winner" does not seem apt), the biggest surprise will be the economy. Since he is the biggest wild-card, we may see the market go soft, at least in the short term, if he is elected.

One of the most fascinating things about the economy, reported on this site and in business journals, is that the economy often does the best when there is a log jam in Washington and nothing happens. Maybe the economy would improve the fastest if Bush left office and we had a one-year moratorium in Washington and they all just went home. There was a time, a long time ago, when that's how it was.

No matter who wins the election, I think the defense, food and energy sectors will remain strong and the housing sector, airlines, and retail remains weak for a few more years. In this case the past may be a good predictor of the future.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares in DUK, GD & SO.

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This month saw great improvement after last month's disaster. Having to conclude my findings on a specific month end day, or any day, depending on the news, sometimes distorts results. For example news on March 31 sent the market down and on April first my picks shot up an unusual amount; hopefully the trend will continue.

My riskiest stock pick Newcastle Investment Corp (NYSE: NCT) was down the most in March but recovered about 35% of the loss in April leaving Valero Energy Corp. (NYSE: VLO) the dubious honor of being my worst performer, down over 30% in the first four months of the year.

April showed improvement as many companies reported positive earnings reports or beat expectations.

The Dow Jones Industrial Average gained some ground in April as did the Standard & Poor's 500 Index, and the technology heavy NASDAQ Composite Index was up with stocks like Apple, Inc (NASDAQ: AAPL) and Google Inc. (NASDAQ: GOOG) improving significantly on very strong reports. Google is up over 25%.

Most of my picks improved. Higher food prices no doubt helped Bunge Limited (NYSE: BG) which recaptured losses moving up 23% from its recent bottom. My two winners Raytheon Co. (NYSE: RTN), the high tech defense contractor, and Reliance Steel & Aluminum (NYSE: RS) were joined by a third, Anglo American plc (ADR) (NASDAQ: AAUK) which had a 10% swing entering positive territory.

Even though it has been a tough year for most of my stock picks I have not changed perspective and my original rationale for my eight picks remains, with the exception of Valero based on its outlook. I do not change my mind based on price but on facts, and that is why though others are down it is only VLO that I am re-examining. See Chasing Value: Final list -- 8 stocks for 2008 for the original story.

In January, I added Newcastle Investment Corp. (NYSE: NCT) and Huaneng Power (NYSE:HNP) to our holdings. I made no additions in February or March among these stocks. In April as HNP hit new lows we acquired more stock. This is a long term position and we are prepared to ride the 5.6% yield as long as it is there for the taking.

Through April the average return for my eight picks was a loss of -8.96%; a welcome improvement from last months sad -15.96% showing. This under-performed the average return of the indices: -6.71%. This years stalking horse, Berkshire Hathaway (NYSE: BRK.B), sagged a little more during the month, still besting both my average and overall indices average. However, the DJIA is slightly ahead of 'my pal Warren' so far this year -- oooh!

Including dividends for my picks, they averaged 3.91% yield though the first quarter. However that must be adjusted because of NCT's reduced dividend, so I have adjusted to 2.99% going forward. Therefore I will be an adding .978% for the first 3 months and .249% (2.99% / 12) for each additional month. Through April the loss was -8.96 + .978 + . 249 = -7.73%. Using 1.8% for the average dividend of the indices divided by 3 adds 0.6%, and reduces the loss to -5.57%. I'm still the loser so far while the gap did close some. BRK.B does not pay a dividend.

I continue to hope that 2008 does not end up being about who loses the least. The following are my eight picks with the starting share price as of December 28, 2007:

• Anglo American plc (ADR) (NASDAQ: AAUK) from $30.79 is Up to $32.75 for a gain of 6.37%.
• Bunge Limited (NYSE: BG) from $119.03 is down to $114.09 for a loss of -4.15%.
• Huaneng Power International (ADR) (NYSE: HNP) from $41.75 is down to $33.65 for a loss of -19.4%.
• Loews Corporation (NYSE: LTR) from $49.35 is down to $42.11 for a loss of -14.67%.
• Newcastle Investment Corp. (NYSE: NCT) from $13.08 is down to $9.89 for a loss of -24.39%.
• Raytheon Company (NYSE: RTN) from$61.51 is UP to $63.97 for a gain of +3.4%.
• Reliance Steel & Aluminum (NYSE: RS) from $54.32 is Up to $60.78 for a gain of +11.89%.
• Valero Energy Corporation (NYSE: VLO) from $70.55 is down to $48.85 for a loss of -30.76%.

The Indices:

• Dow Jones Industrial Average: 13,365.87 dropped to 12,820.13 for a loss -4.08%
• NASDAQ Composite Index: 2,674.46 dropped to 2,412.80 for a loss -9.78%
• Standard & Poor's 500 Index: 1,478.49 dropped to 1,385.59 for a loss -6.28%

This year's "stalking horse" Berkshire Hathaway (NYSE: BRK.B) (I am tracking the 'B' shares, not the more expensive 'A' shares) saw its B shares down from $4,685 to $4,457 for a loss of -4.87%. This is the second month Berkshire has had a loss which increased by a small fraction while most everything else improved.

This year, so far, it looks like the big cap DJIA was the place to be.

Yesterday our Federal Reserve Chairman Ben Bernanke announced another cut in the discount rate of a quarter point to 2% and changed posture to signal it would probably be the last cut.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. DISCLOSURE: I currently own shares of AAUK, BRK.B, HNP, NCT, and VLO.

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• Best Stocks to Make Money Off Ethanol
• Inflation Fears Could End Fed's Fiddling

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Bunge Limited (NYSE: BG) is an integrated agribusiness, fertilizer and food products concern. The company is a leading global processor of soybeans and other grains, a leading provider of products and services to the South American farming community and a major U.S. food processor. Some of Bunge's agribusiness products are used for industrial purposes, including renewable fuels like biodiesel. Archer-Daniels-Midland (NYSE: ADM) is a major competitor.

Investors were pleased earlier in the month, when Bunge-DuPont (NYSE: DD) joint venture Solae Company said it would increase global prices for its soy protein ingredients by up to 30%. The firm said the increases were necessary, in order to maintain a consistent level of service, innovation and investment in research.

BG shares popped on the news and have since been consolidating the gain in a bullish "flag" pattern. Equities frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the stock with six "buys" and three "holds". Analysts see a 17% growth rate, through the next year. The BG P/E ratio (17.99), Price to Sales ratio (0.32), Price to Book ratio (1.92), Price to Cash Flow ratio (9.93), Sales Growth rate (82.45%) and Revenue per Employee ($1.584M) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 72% of the outstanding shares. Over the past 52 weeks, the stock has traded between $70.97 and $135.00. A stop-loss of $89.50 looks good here. Note that the firm is expected to release first quarter results on April 24th, before the open.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.

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After three months it is time to face the facts: two of the three indices beat my picks handily. I have not made a good showing so far and unlike most investment idea sources, I feel obliged to air my dirty laundry for all to see.

My riskiest stock pick Newcastle Investment Corp (NYSE:NCT) is down almost 37% this year, and the energy stocks did almost as poorly even though fuel prices are near all-time highs. The downers were not offset by this months' repeat winners.

March was a seesaw battle, but in the end there was not much to show for it. However, unlike the last day of January (down 370 points in the Dow) and February's last trading day (down 315 points), March had a final day of plus 46.49, which is not very meaningful.

The Dow Jones Industrial Average gave some ground in March as did the Standard & Poor's 500 Index while the technology heavy NASDAQ Composite Index was marginally up with stocks like Apple Inc (NASDAQ:AAPL) improving notably.

Most of my picks sagged a little more, while two remain in positive territory. Raytheon Co. (NYSE: RTN), the high tech defense contractor is up and Reliance Steel & Aluminum (NYSE: RS) is way up.

My original rational for my eight picks remains intact as far as I'm concerned, and although they are down I still like all of them for the year. See Chasing Value: Final list -- 8 stocks for 2008 for the original story. In January, I added Newcastle Investment Corp. (NYSE: NCT) and Huaneng Power (NYSE:HNP) to my holdings. I made no additions in February or March among these stocks. The only purchase we made in March was noted in Chasing Value: Tiffany is looking more polished and that has performed very well.

This month the average return for my eight picks was a loss of -15.96%, almost doubling the -8.06% through February. This under-performed the average return of the indices: -11.19%. This years stalking horse, Berkshire Hathaway (NYSE: BRK.B), sagged a little during the month, still besting both my average and overall indices average. So once more, I must take my hat off to 'my pal Warren'.

Now, including dividends for my picks, which average 3.91% yield divided by four for the three months, allows for an additional .978%, reducing the loss to -14.98%. Using 1.8% for the average dividend of the indices divided by 4 adds 0.45%, reduces the loss to -10.74%. Nothing can make my picks look good this month. BRK.B does not pay a dividend.

Newcastle Investments reduced its dividend by two-thirds in March (going forward) to increase liquidity and possibly buy back shares. In the coming months I will account for this and reduce the accrued dividends proportionally.

I hope 2008 does not end up being about who loses the least, instead of who makes the most. The following are my eight picks with the starting share price as of December 28, 2007:

• Anglo American plc (ADR) (NASDAQ: AAUK) from $30.79 is Down to $29.77 for a loss of -3.31%.
• Bunge Limited (NYSE: BG) from $119.03 it's down to $86.88 for a loss of -27%.
• Huaneng Power International, Inc. (ADR) (NYSE: HNP) from $41.75 is down to $30.54 for a loss of -26.85%.
• Loews Corp. (NYSE: LTR) from $49.35 is down to $40.22 for a loss of -18.50%.
• Newcastle Investment Corp. (NYSE: NCT) from $13.08 is down to $8.26 for a loss of -36.85%.
• Raytheon Co. (NYSE: RTN) from$61.51 is UP to $64.61 for a gain of +5.04%.
• Reliance Steel & Aluminum (NYSE: RS) from $54.32 is Up to $59.86 for a gain of +10.2%.
• Valero Energy Corp. (NYSE: VLO) from $70.55 is down to $49.11 for a loss of -30.39%.

The Indices:

• Dow Jones Industrial Average: 13,365.87 dropped to 12,262.89 for a loss -8.25%
• NASDAQ Composite Index: 2,674.46 dropped to 2,279.10 for a loss -14.78%
• Standard & Poor's 500 Index: 1,478.49 dropped to 1,322.70 for a loss -10.54%

This year's "stalking horse" Berkshire Hathaway (NYSE: BRK.B). I am tracking the 'B' shares, not the more expensive 'A' shares. The B shares are down from $4,685 to $4,472.90 for a loss of -4.53%. This is the first month Berkshire has had much of a loss, but it still bested most everything else....so 'my pal Warren' outperformed all of the indices and my average as well. As was the case last month, individually RTN (defense sector), AAUK and RS (metals) made a better showing.

The Federal Reserve Chairman Bernanke, speaking before Congress used the recession word quite freely, and again shared his willingness to lower interest rates again.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. DISCLOSURE: I currently own shares of AAUK, BRK.B, HNP, NCT, and VLO. (and TIF)

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• Fed Loosens Liquidity Push
• A to Z: Your Energy & Commodities Homework

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The currency of our realm, the US Dollar, has been losing value for many years, but lately the results of this sad state of affairs have become increasingly more evident. Concerns are mounting on a global basis not just in the United States. The euro, once pegged at a buck, is now trading at $1.55, while gold has passed $1,000 and oil has continued its charge, breaking through the $110 per barrel mark.

While a good deal of this problem is home grown, the pain is being felt all around the world. We have read many stories about how the American economy is a smaller part of the global economy and becoming somewhat detached. This is nonsense. What has happened is that the global economy has become infinitely more integrated and like any integrated structure (the architect speaking), what occurs in one place is felt everywhere.

The Federal Reserve Board, led by Chairman Ben Bernanke, has been watching the economy in an extremely measured fashion, bordering on casual. To those who see beyond Bernanke's calm demeanor, one should imagine a stock trader of old, holding the ticker tape up to his eyes and monitoring every change, every blip in the market as the ticker tape machine clicks away, spewing out the latest market activity.

Last Friday the market tanked capping off a bad week and prompting me to post Dow below 12,000 -- do I hear 11,000? Yes I do!. Then, Monday, it tanked again. The Fed had seen enough and juiced up the market on Tuesday by providing a burst of liquidity in the form of $200 billion in credit swaps so that financial institutions would have more capital to lend. This was like taking a hit on a super caffeinated energy drink -- Wall Street got all excited for a day and the market jumped: Dow up +416: The Fed is not dead.

The Fed's action was fun for a day, but by Wednesday, traders were already whining 'what have you done for me lately' and when the sugar and caffeine had burned off, the market fizzled out quickly like some cheap fire works.

We all view the world from our own vantage point and have a hard time seeing the perspective of others, but they feel the pain also, becasue when the dollar goes down in value, it hurts our buying power. And what about the Chinese who are holding over a trillion dollars in US Treasury notes?

Then there are the European farmers and manufacturers crying foul because the relative cost of their goods on the open market has escalated. What about the pain of many of our dollar pegged neighbors, like Costa Rica, whose citizens were already far behind us on the economic curve, and now they also have to deal in dollars that have lost so much value. Oil , too, has gone up in price not just because OPEC won't increase production, but because they are "petro dollars" and correlate to our currency.

Every time our federal government prints more money (or issues digital currency) to cover the federal deficit, trade deficit, Iraq war, which is only off-budget in the imaginations of our government officials (elected and not), lowers interest rates (making Treasury notes less desirable) issues credit swaps or sneezes, the US, AND the Global economy STILL catches a cold! Right now, some are concerned it might be more than a cold -- the world economy might have caught pneumonia.

All of these popular companies must continue to operate under these sickly economic conditions. There is no day off, no place to hide, no running from the competition for Apple Inc. (NASDAQ: AAPL), Amazon.com (NASDAQ: AMZN), Anglo Amer ADR (NASDAQ: AAUK), Bunge Ltd. (NYSE: BG), Diageo plc (NYSE: DEO), eBay (NASDAQ: EBAY), General Electric (NYSE: GE), Google Inc. (NASDAQ: GOOG), Goldman Sachs (NYSE: GS), Microsoft Inc. (NASDAQ: MSFT), Raytheon Company (NYSE: RTN), Reliance Steel and Aluminum (NYSE: RS), Tiffany and Co (NYSE: TIF) and Under Armour'A' (NYSE: UA).

The only way to reduce inflation is to have a balance between the amount of currency in circulation and the goods and services available to purchase with said currency. Every action by the Fed to create liquidity in the economy, generates a phantom value, and if not met with an increase in productivity, is devaluing the dollar and enslaving us to a future of working more for less benefit. That is why I so strongly believe we should fund roads & bridges NOT mad money stimulus. For more discussion you can also read Serious Money: Stimulate productivity not consumption, which I believe is an imperative. That is the gravity of the situation.

In Part Two, I will expand further on these topics and delve into how there actually were and are weapons of mass destruction right under our noses -- economic weapons of mass destruction.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I currently own shares in AAUK, EBAY and TIF.

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