People are worried. Folks with a small amount of money. Folks with a lot.

There’s simply no way to dance around it: The past few months have been tough in the stock market. Due largely to a weak U.S. dollar, soaring commodity and gas prices continue to weigh down our economy.

And since the weak dollar is now driving the cost of commodities and imported goods higher, the Fed’s ability to fight inflation has been severely compromised. The evidence clearly shows that inflation or “stagflation”—which is defined as low growth and higher prices—is clearly becoming a problem (see also, "How to Ride the Falling Dollar to Triple-Digit Wealth").

While this is sad news for us as consumers, it’s actually great news for us as investors. The pessimistic press would have you believe that the dollar's decline against the euro is a sure sign of our country’s demise. I couldn’t disagree more, and as an investor, you can profit from the lowest dollar in 15 years.

So whatever you do—please don’t let the ugly facts about the falling dollar and “stagflation” keep you from making money in 2008. There’s a gold mine of opportunities waiting for investors if you know where to look.

Where to Invest When the Dollar Dives

Have you ever noticed that whenever the dollar hits a new low, the price of oil and commodities reach a new high? It’s no coincidence.

As the U.S. economy slows, the Federal Reserve is manipulating interest rates to shore up the housing market and stave off the credit crisis. The faster the Fed cuts interest rates, the weaker the dollar gets, which then fuels oil’s rocket-ride skyward.

Why? That’s because crude oil is traded in U.S. dollars. So when the dollar is low, other currencies are stronger, which means that folks in foreign countries are able to buy more oil for less money. And that’s exactly what’s happening today (see also, "Get Rich From High Oil Prices").

Although the weak U.S. dollar-rising crude oil correlation has been noticeable since 2002, it really became noticeable in 2007. This correlation has been utterly amazing to the point that if the U.S. dollar slips during the day, you can expect crude oil prices to rise.

Oil & the Dollar Move in Tandem

This chart illustrates just how much in tandem oil prices and the U.S. dollar move. So what the Fed needs to watch out for is cutting interest rates too much, because the dollar will likely weaken further, and then oil could soar past $150 per barrel.

In a similar way, almost all commodities are traded in U.S. dollars, so as the...