The stock market is barely off its highs for the year but it feels like we’re in the start of a bear market. (As of the close today the S&P is roughly 4% off its highs this year). There is going to be more pain it seems as I doubt the Fed can negate the business cycle. With the Fed’s reluctance to keep rates high, commodity prices are hitting new highs while the US Dollar is making new lows. You can now get $1.05 for every Canadian dollar while oil is approaching $100 and gold is now trading at just under $800.

Furthermore bad news is coming out of the finance sector where job cuts are being made at numerous firms (Bear, Merrill, etc.) and hiring is being slowed down for next year.

Invest with caution in times like this. On the positive side with the end of the year approaching and bonuses coming up, it will be in the interests of those managing the money to pop the market up.

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