Yesterday an amazing thing happened at my office.

The phone rang. And rang. And rang. For the first time since May, there was actually a steady stream of incoming calls from resource company executives who, also for the first time in months, sounded upbeat and determined.

This after several months where the phone would go days without ringing, and on the days where it did, I would invariably end up commiserating with the caller over the conditions in the markets, and we would speculate as to how far down we were headed.

But yesterday, Thursday August 21, a full two weeks earlier than expected, the markets seemed to throw off their collective depression, and started strengthening across all resource sectors. Everything was up! Gold, silver, oil, copper, nickel.even lead.

The only laggard was zinc, the slow moving alloy additive that was also the last metal to benefit from the boom in other metals. (So don't worry.zinc should start to strengthen again too.)

So? Is this the bear market rally or the return of the commodities bull?

Well, the answer is - both!

The bear continues to bump around knocking banks over in the states, but for the rest of us, we've got growth on our plates.

Looking at the whole resource sector, one might be forgiven for leaping into the air in the conviction that the bull has returned, and we can all finally shake off the glum feelings of doom and gloom that we've gotten used to waking up with, and get to work.

But not so fast, say the naysayers saying the bull is no bull but merely a bear who's turned around to give his rump a scratch. The mainstream points to the fact that ONE trading company was responsible for 11% of the entire oil futures market - a clear indication that the record prices of oil recently set were not a reflection at all of supply and demand metrics, but the machinations of a giant betting pool controlled by a single croupier.

Demand in China is slowing! they say. India's growth rate has topped out! Brazil has stalled! Russia is at war! All these factors are thrust forth as evidence that the bull is just the bear farting.

Now this is where it gets confusing.

If the "bear market" isn't over, and by that I assume we're talking about the big boards where the financials are dragging their sorry asses incrementally downward, then shouldn't that see the U.S. dollar strengthening (it isn't) or demand for fuel increasing (nope) or better jobs numbers (yeah right) and increased consumer spending?

Well none of that is happening.

In fact, retailers are starting to fall like bricks in the good ole U.S. of A.

Retail store closings and retail bankruptcies have begun to accelerate. This will lead to hundreds of thousands in job losses. Barry Ritholtz, Chief Market Strategist for Ritholtz Research, recently documented the fate of many retailers so far:

• Ann Taylor closing 117 stores nationwide ;
• Bombay Company: to close all 384 U.S.-based Bombay Company stores;
• Cache, a women's retailer is closing 20 to 23 stores this year ;
• CompUSA (CLOSED);
• Disney Store owner has the right to close 98 stores;
• Dillard's Inc. will close another six stores this year;
• Eddie Bauer to close more stores after closing 27 stores in the first quarter;
• Ethan Allen Interiors: plans to close 12 of 300 stores to cut costs;
• Foot Locker to close 140 stores;
• Gap Inc. closing 85 stores;
• Home Depot store closings 15 of them amid a slumping US economy and housing market. The move will affect 1,300 employees. It is the first time the world's largest home improvement store chain has ever closed a flagship store;
• J. C. Penney, Lowe's and Office Depot are all scaling back;
• Lane Bryant, Fashion Bug, Catherines closing 150 stores nationwide;
• Levitz - the furniture retailer, announced it was going out of business and closing all 76 of its stores in December. The retailer dates back to 1910.;
• Macy's - 9 stores closed ;
• Movie Gallery - video rental company plans to close 400 of 3,500 Movie Gallery and Hollywood Video stores in addition to the 520 locations the video rental chain closed last fall as part of bankruptcy;
• Pacific Sunwear - 153 Demo stores closing;
• Pep Boys - 33 stores of auto parts supplier closing;
• Sprint Nextel - 125 retail locations to close with 4,000 employees following 5,000 layoffs last year ;
• Talbots, J. Jill closing stores. Talbots will close all 78 of its kids and men's stores plus another 22 underperforming stores. The 22 stores will be a mix of Talbots women's and J. Jill ;
• Wickes Furniture is going out of business and closing all of its stores. The 37-year-old retailer that targets middle-income customers, filed for bankruptcy protection last month;
• Wilsons the Leather Experts - closing 158 stores;
• Zales, Piercing Pagoda plans to close 82 stores by July 31 followed by closing another 23 underperforming stores;
• Linens & Things just went belly up, and Steve & Barrys recently filed for bankruptcy protection and sale.

So that's retail dying a slow death in the United States. Hardly a sign that the bear is anywhere near done.at least for consumers in the U.S.

But what is starting to happen, and this is evidenced by the fact that the U.S. Dollar and the Canadian dollar to not necessarily diametrically oppose each other any more, is that the rest of the world has more or less factored in the absence of the U.S. consumer at the bargain rack for now and gotten back to the business of building their own economies.

The U.S. is increasingly isolated from growth and development in the rest of the world, and even though the U.S. has been Canada's biggest export recipient, the markets lost in the U.S. can and will be replaced by others in more distant lands.

According to Retuers Metals Insider:

"China, the world's top producer of refined lead and a net exporter, has stepped up imports of the metal in the past month on weak international prices, a move that could help support values. Strong demand from battery makers and investors has driven up premiums for spot refined lead for delivery at Shanghai port to as high as $170 per tonne above the London Metal Exchange cash price, currently at $1,814, traders said. " Prices of long steel will bounce back from a recent 30 percent fall once construction work in the Middle East picks up after the summer lull, but weaker global economic growth rules out a return to record highs soon. Swiss-based firm Glencore International AG plans a joint investment with Zambia's Copperbelt Energy Company (CEC) to build a $1.5 billion hydro power station, a senior CEC official said on Thursday. CEC chief financial officer Michael Tarney said the plant will generate 750 megawatts of electricity. CEC is Zambia's sole power distributor to the vast copper and cobalt mines, and also said it plans to spend a further $300 million on generation expansion to boost supply to the mines. South African miner Metorex Ltd will invest up to $400 million in new copper and cobalt project development in the Democratic Republic of Congo (DRC) to increase output of the metals, it said on Thursday.

So the bear is alive and well in the Unitied States, but the Bull has just pulled up stakes and moved north, east and south.

Now.BACK to work!