The Dow is going to 12,000, according to the latest cover story in Barron's, the leading investment daily. That's what the "portfolio chiefs" say in its latest "Big Money Poll." What a shocker. People who make a living on Wall Street think stocks are going up. Have they ever thought they were going down? Not in our memory.

And here in London, columnist Irwin Stelzer has a bout of hallucination in the Sunday Times. "The normal nervousness of investors and market watchers has been converted into paranoia," he claims, when in fact all the news is good. What are investors worried about, he wants to know. Why is gold going up?

The happiness mongers are out in full force. Something must be amiss.

Unlike them, we don't claim to know better than anyone else what the future will bring. Instead, we look to the present and try to see what it has brought already. And, what we see is a public as short on worry as it is on cash. And that, dear reader, is precisely why the economic news is so good, because consumers are spending their fool heads off. People are still buying houses, as Mr. Stelzer points out. The GDP is still increasing.

Why? Because people are spending money they haven't earned yet. Worried people don't do that.

Meanwhile, debt levels are soaring. Bankruptcies are increasing. Inventories of unsold houses are mounting. Even the pawnbrokers report that business is picking up briskly.

We have to wonder whether Mr. Stelzer will turn out to be like the young ship's officer on the Titanic, who commented - after it hit an iceberg - on how he thought the orchestra never played better. He had not bothered to look below decks.

Naturally, the dollar is sinking. The U.S. deficit has now reached 7% o GDP, but that is just more good news in Mr. Stelzer's book. It "will correct the imbalances gradually," he predicts...as if he knew.
 
As the dollar sinks, the price of oil rises and so do consumers' costs. Even at today's prices, according to the Times writer, gasoline is not as expensive, in real terms, as it was three decades ago. Well, that's a comfort. The poor homeowner can barely make ends meet as it is. Imagine what a fix he will be in when the price of oil goes higher.

Even Thomas Friedman at the New York Times thinks the biggest challenge facing the United States today is oil, but the black goo is way too slippery for a writer as slow and clumsy as Friedman.

As the Times' leading columnist, the man has achieved fame and fortune not merely beyond his merits, but so much beyond belief that it is as if a draft animal had won the Nobel Prize in physics. True to form, in his column today he gets so tangled up in his loopy ideas, he practically strangles himself.

On the one hand, he points out that high oil prices enrich evil regimes around the world. On the other hand, high energy prices help reduce demand for oil in America, which should lower prices. And then, poor Friedman runs out of hands.

Giving up on analysis, he switches to political action! He proposes a new political party, "something like the 'American Renewal Party,' that would focus on energy policy as its key platform position:

"My gut says [Friedman listens attentively to the gurgling of his own repulsive body parts] that some politician...will take a flier on telling Americans the truth [maybe his gut never met a politician...he should have gone to the very bottom of the GI track]."

What truth does the columnist long to hear? Alas, here is where the cords of reason begin to cut into his own cushy neck:

"The only way Americans are ever going to enjoy relatively cheap gasoline again is if we raise the price...and fix it at that higher level...so investors know it is not coming down."

That should do it, dear reader. Oh, we do hope the American Renewal Party gets up and running. What fun it will be to see what these clowns do next!

Two days ago, the dollar sank to its lowest level against the euro in almost a year. Gold rose...up $1.30 on June contracts.

At this point, we anticipate a correction in the price of gold, but not a correction in the silly opinions of the happiness mongers. That will take a gold price well over $1,000 an ounce.

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.