From that perspective alone, the current pattern of money supply weakness deserves scrutiny, particularly if the erosion persists into the new year. Essentially, the longer the pattern lasts, the greater the economic impact of this erosion.

The market is trading very defensively. That is putting downward pressure on bond prices.

It is no coincidence that households found it more difficult to maintain current payment schedules just as the volume of refinancing activity began to dry up as the second half of the calendar year got underway.

There's a huge conviction in the Wall Street community that this will be a successful, surgical, short-lived military incursion. That it will not cause any collateral damage to oil fields, that it will not destabilize Middle Eastern governments and that it will not lead to acts of terrorism in the United States.

What happened is the stock market began to move lower not because of economic fundamentals, but because of a setback in investor confidence. This huge evisceration of wealth is being seen as a leading indicator of the economy. Against that backdrop, CEO perceptions of the economy's potential have worsened.

The friendly data such as the decline in the NAPM non-manufacturing added support.