We are seeing mass selling of everything, so it appears panic is back in the air and cash is king. Asia markets closed down around 10%, Europe down around 7% and our markets currently down 400 points(about 5%). Usually on days like these you see a flight to quality, meaning investors sell equities and buy bonds, treasuries and gold. Not today, the fundamentals are out the window. Even on a day when OPEC announces that they are cutting production of oil by 1.5 million barrels a day, oil is still trading lower by about $4.

As for economic reports, like it matters, existing home sales came in higher then expectations at 5.18 million versus consensus of 4.95m. This is a postive sign that the housing market is picking up but home prices continue to fall. But still on a day like today, it is nice to get some postive news.

We still say that longer term outlook is for lower rates but late yesterday and this morning we have had a pretty big sell off in mortgage back securites which is driving rates higher.