VP of Common Sense

$59 Billion Dubai Debt Default Could Have Much Wider Implications

So, if this event leads to a significant strengthening of the dollar, which it appears it has, does that mean a rapid unwind of dollar carry trade positions? And then a decrease in US equity valuations?

Global Markets in Review: Share Prices Too Far Ahead of Economic Reality

I haven't looked, but isn't this the 3rd or 4th time Pierre has written some version of this article?

How Much Downside Could Still Exist?

Some observations:

In recent history (Black Monday, Asian Crisis, 9/11) when the stock market goes into free fall, meaning near vertical charts, the duration of the fall (in time) is relatively short.

Someone with access to a Bloomberg said that if the DOW was to return 6% a year from here for the next 10 years we would eclipse (in a negative way) the great depression. So it appears things are plenty bad already.

The bank stocks, AIG, GE, all old news. The cumulative market cap of those is what? 10% of October 2007? There is no significant downside left in these stories.

The PPI, most sentiment indexes, unemployment, inflation, oil prices, and other commonly accepted measures of economic conditions are either flat or curving towards flat since November. September-November was when things went vertical.

None of this proves a darn thing, but the fact that this thread and another similar one are both lacking any posts actually calling a bottom, is interesting to me. This is a game of psychology at the end of the day. Instead it's doomsday scenarios, personal politics, a little name calling, and bemoaning of losses. I feel confident of at least a bear market rally.