Place the raisins in a saucepan. Add enough water to cover. Bring to boiling. Remove from the heat and let stand until cool. Drain off the water.
Toss the nuts with the 2 tablespoons flour. Set aside.
In a mixing bowl, beat the butter for 30 seconds. Add the sugar and beat until well combined. Beat in applesauce.
In another bowl, combine the 2-1/2 cups flour with cinnamon, baking soda, and nutmeg. Add to beaten mixture, beating until just combined.
Stir in the raisins and nuts.
Turn batter into a greased and floured 10-inch tube pan. Bake in 350 degree F oven for 65 to 70 minutes or until done. Cool in pan on wire rack for 20 minutes. Remove from pan and let cool.
Prepare the Caramel Frosting. Spoon over cake. Makes 12 servings.
For a contrasting chocolate drizzle, melt 1/2 cup semisweet chocolate pieces and drizzle the chocolate over the Caramel Frosting.