Today AP put it very well, "Stocks slid further Monday as Wall Street absorbed a gloomy outlook for the banking sector and anticipated bleak news from the National Association of Homebuilders. The Standard & Poor's 500 index and the Dow Jones industrial average each lost more than 1 percent." Dow is down 175 (below the important 13K level) & NAZ is down 1 1/2%. Goldman downgraded Citigroup (C) because they will have to write off 15B in loans. There are worries that the bad housing market will drag more industries down. Lowes (LOW), #2 to Home Depot (HD) ,forecasted lower 4th quarter earnings in anticipation of further deterioration in housing.
I worry about the weaker dollar. The Euro is $1.46 while the Japanese yen is up to 110 (now they're forecasting 100). This is a very complex issue especially for multi nationals since they are affected in many ways. But I'm afraid on balance the weaker dollar hurts the US economy & the stock market.
I remain positive for some banks, housing related issues REITs, MLPs & the Dividend Aristocrats in the S&P 500 index. This remains homework time preparing for better buying opportunities. Remember, Chicken Little didn't prove right.
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