Not surprisingly, economic news was generally weak during the month of September. Given the near work stoppages surrounding the September 11 attacks, and the continued uncertainty, we are bound to see a couple of months of poor economic results. In some cases, the economic figures might be worse in October. For instance, the Labor Department has already said the September labor report wasn't affected by the attacks, in contrast to the October report, for release next Friday, which will be. But in other cases October figures may not be so bad. The University of Michigan's consumer sentiment index inched up to 82.7 in October from a level of 81.8 in September.

Market players have been quite focused on taking one day at a time. But the FOMC meeting is now only a week away. It is likely that the bulk of the economic news may have the Fed leaning toward another round of easing, perhaps reducing the rate 25 basis points in November and again in December. Alan Greenspan has been cautious in his remarks about current economic events, but it would be hard to believe that he wouldn't allow the fed funds target to drift down to 2 percent by year-end from its current level of 2.5 percent. After all, the real (inflation-adjusted) rate is just about zero at this point and the Fed could be a bit more accommodative in this environment.