I love how they say this is a surprise. Right… and so was people who owe money to Blockbuster defaulting on a $500,000 home loan.
I think it will pickup mid-day but still end 100pts down or so. The prospect of the FED coming to the rescue with more money and/or a rate cut will keep the bulls in the game a little longer.
I hate to admit but if I had to guess the FED will probably cut rates given the amount of pressure for it now.
I’d guess the death of the bulls will arrive when we have a one week rally after the cut, and then $100 Billion in mortgages reset in the coming months dropping it even harder.
The idea of a rate cut as helping the problems that were the result of the rate cut is just about in line with the logic our economy seems to be under these days.
