TUESDAY MAY 4, 2010

Market Correction

As of the time of this writing, the Dow is down 226 points or over 2%.  Is this the beginning of the end?  I doubt it.  The markets have staged a remarkable comeback, so a correction should not be a total unexpected.  More interesting are the reasons (excuses?) being thrown around for this sudden drop.  The failed terrorist attack in NYC.  The oil spill in the Gulf.  The continuing Greek tragedy and the fear of contagion.  The strong dollar.  All of these have been mentioned as "the" reason for today's decline.

However, all of these events/situations have been known for a while, whether since the weekend in the bomb plot and oil spill to the on-going, never ending Greek fiasco.  Why would the market correct on these news makers today, as opposed to yesterday or the day before?  Yes, in aggregate, these events are reason for concern.  And good reason to take a profit after a great run in the markets.  I doubt there is more to it than that.

POSTED AT 1899-12-30 13:43:00.0

KEN ENTENMANN, CFA
SENIOR VICE PRESIDENT AND
THE DIRECTOR OF INVESTMENT MANAGEMENT SERVICES

Ken is a Senior Vice President and the Director of the Trust and Investment Services at Alliance Bank, N.A. He has 23 years of investment experience and oversees the management of assets totaling $1 billion. He holds a B.S. in Applied Economics and Business Management from Cornell University and an M.B.A. from the William E. Simon Graduate School of Business Administration at the University of Rochester. He has also earned his Chartered Financial Analyst designation. He is a member of the Executive Committee of the Trust Division of the New York Banker's Association. He is also a director of the Central New York Community Foundation.

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