Markets started the week off slowly, but quickly picked up steam after several u pbeat economic reports

were released. Despite the headwinds blowing across globa l economies, a handful of important domestic indicators showed that the economy improved in September. All three major indices responded well to this news, post ing their first positive week in three weeks, and the Dow finished at its highes t level since December 2007.[1] The biggest news last week was that Fridays jobs report showed that the unemploym ent rate slid to 7.8% dropping to a near four-year low and the economy gained 11 4,000 new jobs in September. While these numbers beat economists expectations, th e not-so-great news is that many of the jobs added were only part time. While its too early to see the full effect of the Feds QE3 program, the monthly jobs repor t is one of the best indicators of the economys current state of health. Since th e whole point of QE3 is to create more jobs and soothe jittery markets, economis ts and analysts will likely key in on this report to gauge the effectiveness of the Feds plan.[2] In the FOMC (Federal Open Market Committee) meeting minutes released last week, we were able to gain some insight into the Feds decision to use mortgage bonds (i nstead of the usual Treasury securities) to bolster the economy. According to th e official release, Fed officials determined that boosting the housing market wa s a good way to lift the broader economy.[3] According to remarks by Chicago Fed President, the Fed will continue its QE3 actions until unemployment falls below seven percent.[4] Moving ahead, we should not be surprised to see some market volatility as earnin gs season heats up. Of the 103 S&P 500 companies that have provided earnings gui dance, 78% of them (80) have issued a third-quarter forecast that falls below th e Wall Street consensus estimate. But that doesnt mean you should buy into the do om and gloom forecasts you may be hearing. While past performance is no guarante e of future results, even during the peak of the 2007-2008 financial crisis, mor e than half of S&P 500 companies topped Wall Street estimates in the third and f ourth quarters of 2008.[5] As always, well be keeping an eye on things; and well b e keeping you informed. We hope you have a great week!