Oil has hit another new high, driven largely by the Dollar hitting a new low, though there has been some recovery since the Federal Reserve has agreed to issue at least another $200 billion, this time using mortgage backed securities, aka “Worthless Garbage”, as collateral.

I’m not sure that this will make a difference in the strength of the Dollar. It now appears that the United Arab Emirates is seriously considering dumping their dollar peg, which is clearly a step towards Euro denominated oil.

In today’s episode of really bad policy, it appears that Congress is moving toward privatizing profits and socializing losses in real estate, by expanding the loans that FHA insurance covers. Yep, this will work so well, like it did for MBIA and Ambac.

In more general investment news, Bear Stearns is tanking on concerns that it lacks sufficient liquidity to cover potential margin calls. It probably does not help that Moody’s has downgraded Bear Stearns Alt-A mortgage backed securities, more than half of those issued from 2005 through 2007. Ouch.

Subprime’s favorite whipping boy, Countrywide is going down like Elliot Spitzer’s hooker, the Bank of America offer is now a 32% premium, as versus a 9% premium 2 weeks ago, so people are thinking that BoA will just walk away.

In the world of Real Estate Investment Trusts (REITs), we have had downgraded price targets on three Mortgage REITs.

What took them so long.

Finally, in things that make you say, Whiskey Tango Foxtrot, we have a report that, 20% of Silicon Valley startups cannot get to their working cash, because they invested it in Auction Rate Securities to get better rates of return, and that market is completely frozen.