Financial Select Sector (NYSE: XLF) closed at $13.69. XLF October option implied volatility is at 175, November is at 123; above its 26-week average of 41 according to Track Data, suggesting larger price fluctuations.

SPDR Gold Trust (NYSE: GLD) closed at $89.90. Gold is recently up 3.99% to $921.90 according to Bloomberg. GLD October option implied volatility is at 62, November is at 53; above its 20-week average of 30 according to Track Data, suggesting price movement.

Oil Services Holders (NYSE: OIH) closed at $97.60. Crude oil futures are recently down 4.98% to $82.28 according to Track Data. OIH holdings include BHI, BJS, DO, ESV, GRP, GSF, HAL, SLB, HC, NBR, NE, NOV, RDC, RIG, SII, SLB, TDW & WFT. OIH October option implied volatility is at 120, November is at 102 above its 26-week average of 39 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Financial Select Sector (NYSE: XLF) is recently trading at $19.50 in pre-open trading, below its close of $21.15 Friday. XLF September straddle is at $1.90, October is at $3.59. XLF September option implied volatility is at 100; October is at 66 above its 26-week average of 38 according to Track Data, suggesting larger price fluctuations.

Oil Services Holders (NYSE: OIH) is recently trading at $157.80 in pre-open trading, below its close of $164.21 Friday. Crude oil futures are recently down 5.51% to $95.60 according to Track Data. OIH holdings include BHI, BJS, DO, ESV, GRP, GSF, HAL, SLB, HC, NBR, NE, NOV, RDC, RIG, SII, SLB, TDW & WFT. OIH September option implied volatility is at 55, October is at 45 above its 26-week average of 37 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

TheStreet.com's Jim Cramer says this insurance company is a sign of lower costs, and it's not done yet.

How many ways can I explain that what's going on is massively deflationary? How about by pointing out one of the most sensitive stocks to deflation: Prudential (NYSE: PRU) (Cramer's Take). Take a look at the move this stock has had from its lows. It's almost a 50% move! That's remarkable. It is a sign that everything is worth less than it was a couple of months ago!

I have long used the price of conservative insurance companies -- and PRU is a conservative one -- as a gauge of inflation. Now, I know that Barron's had a positive article about PRU this weekend, but all you really got was a rehash of what an analyst has been saying. That's not behind the gain.

This company is a bulwark of deflation. Why anyone thinks that inflation is still a problem after looking at that chart is just nuts.

TheStreet.com's Jim Cramer says the oil stocks' decline yesterday was exacerbated by a hedge fund's collapse.

"I think the collapse in the commodity stocks shows a worldwide recession."

"The decline in oil and oil service stocks, far more severe than the decline in the commodity, bodes for $80 oil and gas."

"Without a hurricane hitting rigs, the companies involved in the servicing and maintaining rigs will have severe earnings declines, at least according to their stocks."

These are three perfectly acceptable analyses of the action in the Oil Services HOLDRs (AMEX: OIH) (Cramer's Take) and in the oils in general yesterday in light of Gustav's failure to do any real damage and a continued expectation that economies around the world are slowing.

It's just that they are false takeaways. The single most material issue for the stocks -- not the companies -- was the collapse of Ospraie Management, which blew up and got blown out and took a ton of stocks down with it. The fact that this market is thin, that lots of players clearly knew this blowup was coming, and that the fund was no doubt leveraged up the wazoo (as all desperate managers tend to be) exacerbated the declines perhaps two- or threefold.