This content originally appeared on RealMoney Silver on Oct. 1.

Tentative signs in housing, automobile, Chicago PMI and several other economic indicators continue to remind us that the month of September was weaker than generally expected. Meanwhile, prices paid are steadily higher and prices realized steadily lower, raising the continued specter of margin compression and offsetting some of the productivity benefits stemming from draconian cost-cutting measures.

At the risk of being the boy who cried wolf, I believe that market participants have a false sense of security in rising equity share prices. While the consensus and favorable baseline

S&P 500

EPS outcome of $73 a share for 2010 is possible and logical, there exists a wider-than-normal range of outcomes -- some (such as a less-than-smooth withdrawal of monetary and fiscal stimulus) not as positive for capital markets.

I would pay particular attention to the top-ranked housing analyst's report at First Boston this morning who writes, "Our conversations with national and regional builders over the past week suggest that the slowdown in orders that began in the second half of August has accelerated through September."

Finally, I will remind you that the ISM was the leading indicator that the bullish cabal singled out for economic recovery. Now that it disappoints, it resonates with the sound of one hand clapping. This just goes on to confirm my bearishness.

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At the time of publication, Kass and/or his funds had no positions in the stocks mentioned, although holdings can change at any time.

Doug Kass is the general partner Seabreeze Partners Long/Short LP and Seabreeze Partners Long/Short Offshore LP. Under no circumstances does this information represent a recommendation to buy, sell or hold any security.