The volatility of the stock market has been either unusually large, or "drastic" according to who you listen to. I am NOT saying that the market has not been volatile, but in my opinion it's effect has been exacerbated by the media hype it has received. It is important to note how the DJII is calculated.

Basically, every change in any stock in the Dow 30 should be multiplied by 8 to get the approximate effect on the average. For example, if ANY ONE of the Dow 30 stocks were to decline by 5 ponts (and it makes no difference whether it is IBM, currently the highest price stock in this average at approximately $110 per share or Intel which is around $24 per share, currently the lowest) this 5 point decline will have the effect of creating a 40 point decline in the average. (Going up has the same effect of course.)

One must also remember that the Dow Jones Industrial Average is now around 13,000. A 500 point advance or decline would be a 3.8% change in the overall average. A large change indeed but as a comparison on October 19th, 1987, the Dow Industrials dropped 508 points, which was a 23% decline. (I do remember that day!)

All I am saying is that we should concentrate on the percentage change much more than the point change. I know how the media makes its money, but PLEASE, keep things in perspactive. I guess I get a little tired of the hype. . . "stand by, after this commercial we will come back with the 'manufacturers index', 'beige book report', 'confidence index', etc." Personally I never did understand the "Confidence Index." I always thought when the market went up, people were confident and when it went down, they weren't.

One of the reasons that we meet with and speak with the Investment Managers that we use is to satisfy ourselves that they are keeping things well in perspective. We, Arthur & Steven Rosenberg, are both Senior Vice Presidents, Investments of Raymond James, and these managers are investing our and our client's money and we want to feel confident that they maintain focus. We are also not "traders" and neither are the managers we use. It is important that we all maintain perspective.