What, a Halloween that is not scaring the markets? Halloween may not be, but October 2008 will go down as the most volatile and scariest month ever in the world wide financial markets and we cannot wait for November to come. Oil in October dropped below $100 a barrel, than $90, than $80, than $70 and now is around $65 a barrel. Gas is now being reported in the Twin Cities as $1.99 a gallon. Dow tumbles to almost 8,000 and now back up over 9,000. What a month. History in the making but we have to be honest, we are glad the month is over.



So what’s gong on in the Markets on Halloween. Nothing scary right now. MBS prices are up +12/32 (FNMA 30-yr 6.0 at 100.10), which is slightly below where PHH priced this morning which was around +16/32nds. The 30-yr fixed FNMA required net yield (60 day) is now at 6.37%, up from 5.84% at the end of September. This morning, MBS markets have recovered some of the losses seen earlier in the week. Today's economic data had little impact. The Core PCE price index rose 2.4% from one year ago, matching expectations, and Personal Income also came in close to the consensus forecast. The Dow is up, but only 10 points. Chicago PMI and Consumer Sentiment will be released soon, and Bernanke will be speaking this afternoon and that could add one more round a volatility to this October 2008.
Happy Halloween