2-Oct

Markets become un-correlated

The markets have become un-correlated. Typically if oil was up, traders became concern about inflation and markets were weak, especially the Transports. Today oil dropped below 94 and DOW transports collapsed. Dropping oil prices are now reflecting fear of the global economy slowing. Everything is being sold except the Dollar which has been extremely strong due to fear of global recession. Even gold was down 35 dollars today.The rescue plan is set to go back to the House of Representatives tomorrow, and the fate of the markets rest on their vote. Agree with the plan or not, the markets are looking for a rescue of some sorts.

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