Good morning. What can one say other than it was an outstanding day for stocks and your 401K! The Dow closed up 109 points at 17,266 and the S&P 500 gained 10 to 2,011. The Nasdaq didn’t close at a new record high but was the biggest percentage gainer on the day closing up 31 points to 4,593. The market digested and liked Dr. Yellen’s and the Fed’s statements on Wednesday leaving in their “considerable time” language regarding on how long they’ll leave interest rates low. U.S. equity markets have rallied for three consecutive sessions as the Fed’s stance has eased investors’ worries the central bank was ready to pivot away from holding rates at rock bottom levels, which is stimulating demand for riskier assets like stocks. Their support has lifted the S&P 500 to 34 records in 2014 and helped the major stock indexes dodge a 10% correction for almost 3 years. The climb in equities to repeated highs has coincided with steadily improving economic data making investors shrug off occasional weak economic data (like August’s unemployment report) and at the same time has pushed interest rates on safe haven assets like Treasuries to very low levels pushing yield hungry investors into equities.

The big geopolitical news this morning is that the “No’s” have triumphed resoundingly in Scotland winning big by 10 points (55%-45%) meaning Scotland will remain in the UK at least for a generation. Turnout was massive with 85% of eligible voters voting. From purely an economic viewpoint this is a good thing. Instead of capital fleeing Scotland due to all the uncertainty that would have been created with the “Yes’” prevailing, capital shall now flow into equities, plant, equipment and lending. Always remember, capital shuns uncertainty.

This morning its euphoria across the globe with all the Asian markets closing significantly higher especially Japan’s Nikkei 225 gaining a huge 1.58%. London’s FTSE and Germany’s DAX are flowing Asia’s lead but I guess the French haven’t read about the Scottish vote for their market is basically unchanged. Here in the States we’re off to the races with Dow futures up 5. There will be a record set today and that will be Alibaba’s IPO which will be the largest in history raising a staggering $22 billion. And get this, it looks like it’s oversubscribed by a factor of 10! For reference, most popular IPO’s, like Twitter, are oversubscribed by a factor of 6 to 8. As one wealth management advisor put it “This is going to be a feeding frenzy!”

There were two economic reports of significance released yesterday. The first was the Labor Department’s weekly unemployment claims which fell a huge and expected 36,000 to 280,000 taking them to a gnat’s eyelash of the 14 year low set in July and well below the Street’s expectations. The other report was Housing Starts and unfortunately it was very disappointing with starts falling in August to 956 thousand annualized units or more than 14% lower than the starts figure for July. The market was expecting only a 4-6% decline. Adding to the bad, building permit applications fell 5.6% to 998 thousand and this too was below the consensus.

After rising 3% earlier in the week and closing down 46¢ on Wednesday oil got hammered yesterday with WTI closing down $1.35 at $93.07 and Brent losing $1.27 settling at $97.70. Traders continue to view that the world is well supplied with oil with demand flat and production here in the U.S. continuing to rise. I’m seeing the effect of this sentiment in the price curve with the term structures moving bearishly, i.e., the front months’ prices are moving lower relative to the deferred contract prices. In the physical market this means storage is in greater demand for each incremental amount of storage capacity costs more than the previous one and a commodity supplier must decrease his price to account for the increase in the price of this capacity.

This morning WTI is still taking its licks being down 67¢.

The EIA released its weekly storage report yesterday showing the U.S. injected 90 Bcf into storage last week. That was pretty much in line with expectations with the market expecting a 90 to 92 Bcf injection. But traders didn’t view it that way. Immediately after the release of the report natty fell, and fell some more closing down 10.3¢ at $3.910. My opinion is that traders didn’t want to take prices higher over $4.00 so took it the other way. Even though we were down over a dime yesterday we’re still materially above the low set in July and August of $3.724. The market seems to like that $3.90 level. Maybe that’s because it’s equivalent to coal. For you non-clients there’s a freebie for you!

This morning like the rain here in Houston is doing to the soil natty is eroding 6.3¢.

My how things change. Whereas in the 20’s through the 70’s Ohio boomed with manufacturing (Akron was known as the “Rubber Capital of the World”) since the 80’s it’s fell into despair as the rubber, oil refining, auto manufacturing and steel making industries moved first south and then overseas. Ah, but we have yet another case of horizontal drilling and hydrofracking changing things for the better. And much better. Youngstown Sheet & Tube’s old abandoned plant has been purchased and has been re-opened by Vallourec, a French steel manufacturer, bringing jobs and tax revenue to the local area and state. And you know what Vallourec is making at the plant? Steel pipe for the oil and gas industry and they’re running 24/7 to meet demand. And the word is they plan to increase capacity as soon as they can hire qualified workers. And, oh, did I forget to mention Ohio’s unemployment rate is 1 ½% below that of the national average?! “Oh say can you see…..” Have a good weekend.