Market Perspective 10/17/2008

Early this morning we got some bad news on the housing market showing housing starts and building permits at multi-decade lows. From my perspective, the market sort of took this in stride although the intra-day volatility continued. At this point, the market I dont think is really trading on housing market data. Rather at this point, it's probably going to be the jobs related data that drives the market.

Volatility continued throughout the day. One of the big stories continues to be oil prices which are literally plummeting before our very eyes. The driving factor behind oil prices in the low $70s is simply a slow down in economic activity. For the near term world consumption of energy may drop off. One interesting observation is that OPEC is going to meet soon to decide what to do about the falling price of oil. They dont like the fact that oil could head to $50/bbl. They will probably cut production in an effort to keep oil prices well above current levels as they know that at these levels, oil prices are probably not a deterrent to economic activity. This is part of the reason we need to get off foreign oil. We are not in control of our own destiny.