Houston, Texas, November 3, 2008 - At the end of a highly volatile month, equities plummeted, bonds were down, and liquidity securities ended up. Overall, traditional investment grade U.S. capital markets had their worst percentage loss in over 10 years, and largest dollar loss ever. The 6.20% decline for the month of October wiped out nearly $1.9 trillion to bring the size of the traditional investment grade U.S. capital markets to $28.67 trillion.

Equity securities closed October with the largest single month loss in dollar value ever by shedding over $1.9 trillion dollars, nearly $500 billion more than the September decline. All sectors were down, with near 21% declines in both the Manufacturing & Wholesale Trade and the Finance, Insurance, & Real-estate sectors. Equities started November valued $11.57 trillion, a 40.35% share of the traditional investment grade U.S. capital markets.

Tremendous growth in the market for Treasury bills kept liquidity securities in the black for October. The market for Treasury bills increased by nearly 25% gaining over $375 billion. This market is now nearly $1.9 trillion where a year ago it was just over $700 billion. Those gains overcame declines of about 7% in the markets for commercial paper and for short-term investment grade corporate bonds. Liquidity securities account for 26.36% of the traditional investment grade U.S. capital markets with a value of $7.56 trillion.

Despite growth in the market for long-term Treasury bonds, the overall market for long-term bonds declined 1.78% in October. Corporate bonds were off 6% while long-term federal agency issues were off 4%. Despite those declines the $9.54 trillion market for traditional investment grade long-term bonds now accounts for 33.29% of the capital markets.

An interesting trend is the increase over the past year of the public portion of the traditional investment grade U.S. capital markets. Taking debt issues by the U.S. Treasury, federal agencies and government-sponsored enterprises as the public portion, this leaves corporate debt and equity, along with the remaining money market instruments of commercial paper, certificates of deposit and bankers’ acceptances as the private portion. At the beginning of November 2007 the percentage split of public to private was 72.57% to 27.43%. A year later it stands at 59.97% to 40.03%. Excluding equities from this, the public portion has gone from 46.66% to 40.31%. A year ago the markets were valued at $33.30 trillion with the equity, liquidity, and bond market proportions of 54.56%, 18.52%, and 26.92% respectively.

Dorchester's flagship index, CPMKTS^sm The Capital Markets Index, is carried on The American Stock Exchange under the symbol CPMKTS, with updates every 15 seconds. The Amex also publishes the component indexes: CPMKTE^sm The Capital Markets Equity Index, CPMKTB^sm The Capital Markets Bond Index, CPMKTL^sm The Capital Markets Liquidity Index, CPMKTC^sm The Capital Markets Corporate Bond Index (with yield published in real-time under ticker: CPCYLD), CPMKTM^sm The Capital Markets Mortgage-backed Index, and CPMKTT^sm The Capital Markets Treasury Bond Index (with yield published in real-time under ticker: CPTYLD).

About Dorchester Capital Management LLC.
Dorchester Capital Management LLC is a Houston-based company principally focused on designing financial products for the professional investment community. Dorchester’s unique approach to processing, organizing and standardizing capital markets data from the broadest variety of sources gives it a superior ability to help clients with the fundamental risk analysis questions of asset allocation and benchmarking. For additional information, please visit the company's Web site at www.cpmkts.com.

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