Dollar tanks, crude oil soars

The value of the dollar edged up from its near-record low against the euro, while crude oil traded past the $90 mark on the New York Mercantile Exchange for the first time. The value of the euro traded at $1.4294 yesterday. It has since fallen to $1.426 in trading today. "I think that the dollar has weakened too much as a result of last month's cut in the federal funds rate," said Leo Kamp, managing director and chief investment economist in the asset management at TIAA-CREF Asset Management in New York. "It is still consistent with my view that there is pressure on the dollar due to our account deficit." Crude oil delivery for November rose to $90.07 a barrel in after-hours electronic trading on the New York Mercantile Exchange yesterday. The contract traded down 94 cents to $88.53. Oil should hit the $100 mark by the end of this year or in early 2008, predicts Martin Weiss, editor of moneyandmarkets.com based Jupiter, Fla. He noted that the inflation-adjusted price of oil is not far away from its all-time high of $102.50. "We are not far from that mark right now, despite the fact that there is no oil embargo," he said. "Wall Street has been ignoring oil until now. Today was the first time that you see an impact from the higher oil price." In another market development, the major indicators fell on the 20th anniversary of Black Monday. The Dow Jones Industrial Average fell 274.35 to 13,615.59 in late afternoon trading. The Nasdaq was off 53.58 to 2,745.73, while the Standard & Poor's 500 index dropped 29.92 points to 1,510.16.