I wonder how many banks the FDIC will shut down today. They closed 16 in the last two weeks. That makes up for only closing one in the previous two weeks. And they have more than 400 more on their list of banks at risk. It sounds like they are picking up steam.

There has been a lot of M&A activity lately. Somebody must see some value in this market. I dont think some of these big deals are going to work though.

On a brighter note according to Baker Hughes US land rig counts were up 8 this week. Patterson picked up 8 also in their October count. There has been a big rise in consensus earnings estimates for next year, or a big decline in the expected loss depending on how you look at it. Consensus is for a 20 cent loss next year. It was 40 cents.

Natural gas inventories are still rising. But there was a hefty drop in oil inventories this week. Inventories are still huge. The main thing keeping oil prices up is the low dollar.

Drilling seems to be concentrating on oil now with the higher prices. They are drilling away in West Texas for the light sweet stuff and pulling more rigs out of storage to drill more. Harold Hamm intends a big ramp up of drilling in the Bakken Formation.

Natural gas prices are up with the anticipation of colder weather. But weather is a short term event, whether it be a cold winter or a hurricane, which only serves to spike prices and bring more inventory. We need a stronger economy and lower unemployment to get rid of the enormous inventories of oil and natural gas we have. Consuming it faster than producing it.

If the economy doesnt improve I think we could be in for a bust that will make the mid 80s look like the good old days.