| NO PAIN…NO GAIN? While that old maxim is often the case, for the past week the Stock market’s pain has been the Bond market’s gain. Last week, the Dow lost around 500 points - and as money flowed out of Stocks and into Bonds, this helped home loan rates improve by .125 - .25% over the course of the week.But if you want to revisit some real Stock market pain, just dial back the clock twenty years from last Friday. On October 20th 1987, the Stock market suffered its very largest one day loss ever, with the Dow falling 508 points and losing 22.6% of its value overall. That’s like the Dow losing over 3100 points today! And just prior to that wild meltdown, 1986 and 1987 had been banner years for the Stock market - fueled by hostile takeovers, leveraged buyouts and merger mania.
The rest of the economic news for last week was a mixed bag, including lower than expected Housing Starts and Building Permits for new construction homes, and also an overall tame read on consumer inflation via the Consumer Price Index. |
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