Investors are keeping an eye on the housing market, falling dollar and higher commodities as Wall Street rides a seesaw.  The question on everybody’s mind is if Wall Street collapses will panic prevail.  That is the same question they were asking themselves September 15, 2008 when Lehman Brothers fell.

Stocks struggled at the end of September, as strength in global markets and U.S. commodities vied with some investor caution after the recent rally.  The Dow Jones industrial average (INDU) was little changed more than an hour into the session. The S&P 500 (SPX) index added a few points. The NASDAQ composite (COMP) was barely changed.

Stocks were mixed, with only the NASDAQ managing a fresh one-year high, as investors showed some caution after a more than six-month rally.  That hesitation continued, with investors looking to the Federal Reserve meeting, the series of housing reports this week and the Dow’s climb toward 10,000. Although 10,000 is not a key technical level, it is a significant psychological level.

Since bottoming at a 12-year low March 9, the S&P 500 has gained 57.4% and the Dow has gained 49%, as of Monday’s close. After hitting a six-year low, the NASDAQ has gained 68.5%.  Stocks have risen during those 6-1/2 months on signs that the economy is starting to recover — and extraordinary amounts of fiscal and monetary stimulus.

Among early stock movers, financial shares rose, including Dow components American Express (AXP, Fortune 500), Bank of America (BAC, Fortune 500) and JPMorgan Chase (JPM, Fortune 500).  Citigroup (C, Fortune 500) rose after Singapore sovereign wealth fund GIC said it sold half of its stake in the company. GIC had bought a 9% stake in Citigroup at its lows and opted to cash in on the recent market rally to earn $1.6 billion.

Fed: The central bank began its two-day policy meeting Tuesday with an announcement expected Wednesday afternoon. The Fed is expected to hold short-term interest rates unchanged at levels near zero.  Fed chief Ben Bernanke said last week that the recession is likely over, but the labor market still has a long way to go.

Economy: July home prices rose 0.3%, according to a report from the Federal Housing Finance Agency (FHFA) released shortly after the start of trading. That was short of forecasts for a rise of 0.5%, according to Briefing.com survey of economists. Home prices rose a revised 0.1% in June.

World markets: Global markets rallied. In Europe, London’s FTSE 100, France’s CAC 40 and Germany’s DAX all advanced. Asian markets ended higher.

Forecast: Record low rates hold

Currency and commodities: The dollar fell against the yen and euro, after having advanced for the past few sessions.  The falling greenback lifted dollar-traded commodities such as oil and gold.

U.S. light crude oil for October delivery rose $1.32 to $71.03 a barrel on the New York Mercantile Exchange. COMEX gold for December delivery rose $10.90 to $1,015.80 an ounce. Gold closed at a record high of $1,020.20 last week.

Bonds: Treasury prices rose, lowering the yield on the benchmark 10-year note to 3.46% from 3.48% Monday. Treasury prices and yields move in opposite directions.

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My Take: I never was much of a stock market person.  However, I have heard the recent recession compared to the “Great Depression”.  When I heard was that it was almost as bad.  The only difference I can see is that people were not jumping out of windows because of it.

I truly believe that there was in so many greedy people in the financial world, this problem would not have happened.  People like Medoff lied, cheated and stole millions of dollars from people.  There are probably more like him running around, but they have just been lucky enough not to be caught.

One thing is for sure; all those businesses would not need a commercial loan workout if they had not been lied to.  Instead, they would be looking for more commercial real estate loans so they could make more money.  As the saying goes, hindsight is always 20/20.

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