Barely a fraction of the government s multitrillion-dollar stimulus and bailout dollars have gone out the door and the first criminal charges are already being filed against a huckster who defrauded as much as $6.2 million out of unsuspecting victims.

Gordon B. Grigg of Nashville, Tenn., will plead guilty to four counts of mail fraud and four counts of wire fraud stemming from a scam in which he lured investors based on the promise of fantastic profits made through the TARP program. The Securities and Exchange Commission is already investigating 20 similar scams.

Further evidence that we need more regulation, you say? Well for 12 years, Grigg was a regulated, registered representative, a stockbroker under full oversight of the SEC. Not unlike Bernard Madoff, who was also registered with the SEC, it s quite likely the designation helped create a false aura of credibility for his victims. As we ve pointed out many times over the years, regulation does stop criminals it just makes them harder to detect.

And while you have to doubt the intelligence of anybody who would believe a smooth-talking salesman promising guaranteed profits from Uncle Sam, I can empathize with the difficulty in keeping up with the endless cavalcade of programs that have been launched over the past 14 months. Government has invented a dictionary s worth of programs, each with its own acronym, budget, goal and intended audience. I read multiple newspapers and wire services every day and it s tough for me to keep up with it.

Even something as benign as the level of FDIC insurance, which also changed amid the panic of last fall, can be difficult for individuals to track. Is your bank account secured to $100,000? To $250,000? For how long? (Note: Most accounts are covered up to $250,000 until Dec. 31 of this year.) If I open a $250,000, 12-month certificate of deposit today, is the entire balance insured for the length of the CD, or just until the extended coverage runs out? (Answer: Only until Dec. 31.) That sort of confusion sets the stage for crooks to operate.

As we wrote back in 2002, the Enron fraud, while costly to willing investors, didn t financially impact the average American by one penny. The trillion-dollar government intervention will undoubtedly lead to a correspondingly large amount of theft and deceit. This is just the start.

What s in Your Cup?

On Sept. 12, 2001, the day after the most horrific terrorist attack on American soil since Pearl Harbor, I got up as I do every morning and made myself a large pot of coffee. Some days I buy it, others I make it at home, but a morning cup is a downright necessity. I ve trudged through snow storms and pounding hail for it without hesitation.

To that end, those looking for a commodities exposure might consider keeping an eye on the

(

), an exchange-traded-note that tracks the price of everybody s favorite morning elixir.

iPath DJ-AIG Coffee Sub-Index ETN (JO)

A Caffeine Fix

iPath DJ-AIG Coffee Sub-Index ETN (NYSE Arca: JO) 1 year
Source: BigCharts.com

Influenced by weather, politics, demand and the dollar, coffee has a tendency to experience dramatic one-month swings of more than 20% every few years.

Just yesterday, coffee futures jumped 4% on concern over a truckers strike in Colombia, which could potentially cut off already-limited stockpiles of beans. And at a time in which most assets seem to move in near lockstop, coffee shows a scant 0.22 correlation to the S&P 500 and a weak 0.26 connection to the GSCI Commodity Index.

Peter Lynch always emphasized investors should buy the companies whose products and services they are intimately familiar with. Given that I plan on drinking it until they pry the cream and sugar from my cold, dead hands, coffee will be in my life for a long while. The note, currently trading around $36, is down from a 2008 high of around $50. Call my purchase a simple forward hedge.

For more information: iPath Coffee ETN

Parting Shot

In Zimbabwe, the country s central bank governor admitted to stealing hard currency from private bank accounts in an attempt to maintain the bankrupt government bureaucracy.

In a bizarre and truly surreal statement, Bank Governor Gideon Gono said it was time to let bygones be bygones and that the government would work to repay depositors once its affairs were in order.

It s as if Ben Bernanke ordered your checking account to be emptied so government could pay its employees at the Department of Health and Human Services.

Earlier this year we wrote about the collapse of this formally prosperous country, not because of a lack of natural resources or hard-working individuals, but a political philosophy that nationalizes industries, seizes private property and limits free trade.

That could never happen here, right?