Professor Elam

One might think that higher oil prices would have gurt stock prices, wrong. Oil and stock prices rose from 2002 thru most of 2007.  The fact was that the economy could afford higher oil prices, to a point. At times since 2007, lower oil prices have boosted stocks. This last few days fear of oil suply interruptions actually boosted oil prices and cased some retreat in stocks. But, as hurrican fears subsided, and Gustav passed, stock prices might rally, right?  Wrong again, after stock prices jumped this morning, they spent the rest of the day in full retreat.

The news went back to what it was, fears of a softening economy were huring stocks. And so, DELL dropped over 4%just today.  But wait, DELL is about to introduce a hot new mini laptop, like that cute AZUS, right?  Well yes but that did not help. Fears of fewer computer orders ruled the day.

The moral of this story is that prices in the market are the story.  Other things tend tobe distractions from teh big picture. So in this case, Guxtav was indeed, just so much cool air….