Wednesday, October 01, 2008


For the first time, Rasmussen reports that more people believe the war in Iraq has been a success than the other way around. A few years from now, when gasoline sells for less than $2, more people will join in praise. The more important point is the win in a major battle in the war on terror.

For the first time, more people now support the bail out than oppose it. One of the key reasons it will pass this time is because it is attached to the AMT patch. Earlier, the AMT patch was connected to several pork bills for wind mills. I hope this is a clean bill this time. The increase to FDIC insurance should add some votes and the adjustments to mark to market accounting will add still more.

The polls show that a number of battle ground states are up for grabs but McCain needs a big surge to win. As we have just seen, a lot can happen in 30 days.

In late London trading, one again, financial stocks took the lead. The extra dollars the public will have in their pockets, as a result of the decline in gasoline prices, will help the public make their mortgage payments. Numbers in the USA show that consumers continue to see nice gains in disposable income. Disposable income is a leading indicator of economic strength. Industrial production in Europe has gone from solid growth 5 months ago to a shape downturn last month. This is good news for energy prices, inflation rates and interest rates.

Just a few months ago, huge capital expenditures were being made, for example, big CAT equipment was being bought for mining and construction. For the next several years, equipment will be repaired if necessary. The pressure is coming off the price of every thing from oil to money.