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Debt Debate Market Drag

October 21, 2011 – 5:15 pm

The market this morning is in rally mood after a week of continued volatility. The economic numbers have been better and as we are in the heart of earnings season we have seen another quarter of double digit growth. The growth is not as strong as it has been in previous quarters but it is still very good growth especially considering the economic softness during the summer.

The market will rally above its summer channel only if we get some resolution out of Europe and that might or might not come this week or next.

Long term debt around the world is an issue that most countries are addressing. The fact that Europe and the U.S. have turned their attention to debt is a step in the right direction as Wall Street not only wants an economy in recovery but also one that has a reasonable debt level. One that can eventually not necessarily paid off, but one that allows each country to comfortably manage. Greece is only the poster child of problems. It’s the rest of Europe, the banks and here in the U.S. that is the real threat.

Good Trading
Steve Peasley

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