H. Michael Arguello_

10 Contrarian Reasons for a Bottom

I agree we are retesting previous support levels (now as resistance). I see the rally going forward another day or so and failing to breach the 1,000 mark - then another leg down. We have alot of bad news coming out this coming earnings season, with broader market implications beyond just the financials. Retailers get crushed due to a dead shopping season (ht emalls near me have been dead and I do not live in a high unemployment area), the financials bleed some more, and this time the energy titans come down.

It is interesting that the way the DOW is constructed is price sensitive; a change in the value of XOM is far more potent than a greater move in % in BAC. Energy is the last man standing sector wise but energy's base is getting whacked due to weak demand. Margins are built on top of commodity prices (if it costs me x dollars, I charge 125% x sale price; a decline in x means a decline the 25% that is my profit margin) and with energy prices tumbling so far so fast - watch out the Q4 on energy. THAT will lead us to the bottom imo.

Wall St. bought into the lows of 2001 b/c thats when tech bottomed for the most part - 02 was when the effects finally spread out into the broader market. Same thing; financials ahve been nuked, and as the former heavyweights in the various indexes their demise has caused a great deal of the collapse in index valuations. Now the broade rmarket is starting to feel the impact.

I see Q4/Q1-09 earnings being the bottom as investors across the board get a taste and run for cover, one of these two seasons. Just my $0.02