The ugly truth can sometimes yield beautiful profits, says Irwin Greenstein, writing for Contrarian Profits. But the truth exposed by the US government’s recent round of Wall Street bailouts is that the US actually lost the Cold War in terms of its free-market philosophy. Investors should adjust their portfolios accordingly…

The lesson to be learned from Wall Street’s hubris, says Eric Fry at Rude Awakening, is that although stocks can be ruined by over zealous management, commodities cannot. Stupidity is not a risk factor in the commodities sector. And this makes them attractive despite their recent selloff.

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.

Andrew Gordon in Investor’s Daily Edge is bearish on the outlook for the sector. He says banks are still running on empty. And with the rate of foreclosures rising in the US, this is no time to buy in. Steer well clear until the economy picks up……

One year into the Aug 2007 subprime crisis, and the financial sector is still reeling from the after-effects. Billions of dollars were injected into the money markets and interest rates slashed but the deleveraging journey remains arduous.

Your humble editor is skeptical that this latest financial rally will turn out to be anything of substance… except another shorting opportunity when the time is right.

Tom Dyson says the best way to protect your portfolio from the fallout of a failing Fannie and Freddie is to invest in high-dividend stocks…

Wells Fargo today announced second quarter earnings that show the bank is a stand out among other financial institutions

Bottom line: The current rout in financial sector shares might smell awful to the simple onlooker. But smart investors should know that it smells like the beginning of the end of their collapse, too.

Of course, as John Stepek points out in his Money Morning newsletter, shorting Britain’s biggest mortgage lender is hardly rocket science, given the overall shape of the British housing market. The real question is who the hell would go long on the likes of HBOS?

Sky-high crude oil prices and gas prices are becoming something of a national obsession. They’ve also becoming the mother of all political punchbags. Washington’s finest are scrambling over each other to be seen as championing ‘ordinary Americans’ over the big, bad oil companies and, even worse, the oil speculators.

Late payments on home-equity loans are at a record high, and delinquency rates on loans for cars, small businesses and construction are at levels not seen in a decade or more — all bad news for lenders, regardless of their subprime exposure.

DailyWealth editor Steve Sjuggerud isn’t perturbed by gloomy foreclosure predictions…

From Tokyo to London to New York, financial companies announced plans to shed more than 83,000 jobs since last July as revenue and compensation pools evaporated, according to figures compiled by Bloomberg.

It looks like earnings are really driving this market over the last few weeks as investors are looking for signs of stability. Last week Google helped drive the markets higher. The week before GE helped to drive the market into the ground. Looks like it is Bank of America's turn.