The Volatility Continue

The banks led the stocks lower on Monday and they drove them higher yesterday. The world didn't change in a day but Secretary Geithner spoke sweet words of encouragement about the banks and investors leaped at every positive word. Many companies reported yesterday with very few having good numbers. The important aspect of the earnings reports were not what happened last quarter but how does the future look? It appears that some companies feel that the bottom has arrived while others don't see any hint of sunshine. We have seen minor signs of positive economic activity in the past that ultimately faded away. Such a period was last spring. Will that happen again? Time will tell but for now we remain cautious as the replenishment of inventory phase could be giving companies some false hope.