September 24, 2011

Market Wrap For The Week Ending 23-September-2011

Here is our latest issue of market insights. We decided to give our readers a bit of a (reading) break this week by focusing on the positives among the plethora of bad news emanating from the markets. While viewing the economic glass as half full, it still pays to be vigilant.  Be careful out there!

In This Week's Issue
• Weekly Positives
• Weekly Barometers
• Weekly Chart

Weekly Positives
• Federal Reserve does operation twist- US Treasuries rally to new record highs.
• reports that the average 30 yr mortgage rate falls to 4.0%
• U.S. building permits in August 2011 up 3.2% from July and up 7.8 % from August 2010
• U.S. Existing Home Sales at 5.03mm annualized were 280k more than expected
• U.S. Leading Economic index increased 0.3% in August to 116.2 (2004 = 100)
• Crude oil futures fell below $80 prompting lower gas prices at the pump
• European reality check: Greek economy is only about 2% of Europe's GDP
• Despite a near certainty of a Greek default, the Euro is still trading around $1.3500
• Sharply lower commodity prices easing pressure on inflation and cost of living

Weekly Barometers

st-2011-0923   fx-2011-0923

Weekly Chart 
Gold prices Gold crashed more than $100 on Friday but the elephant in the room in terms of market volatility was clearly silver.  U.S. silver futures dropped 18% on Friday, the biggest daily loss since 1987. However, there was a bit of a “silver” lining amidst these massive falls in commodity prices.  The supporters of doom and gloom scenarios who bought gold, and to a lesser and much later extent also silver, were proven wrong at least for the week.  Perhaps the fall in precious metals will now prompt a move towards a re-allocation into equities after the dust settles. Nevertheless, it still pays to keep your financial seat-belt fastened.  Be careful out there and tread lightly in these murky waters!



Good luck and good investing!

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