Haha brah. This rally has been on no volume. Technically it was due for something like this. Maybe they close it positive, but I'm not sure how many more high volume selloffs this market can continue to swallow. The fact this market just touched pre Lehman bros levels and is giving a climatic sell like this...ummmm...Think about it. Low risk sells here.
..we repeat 1929 because traders backtested, and curve fitted their systems on the historical data of great depression
Until the TARP is done and easy $ is done, then you short. It is ironic that the Fed's (aka SEC....all the same) went after GS after tax day, and it will weigh on the market...but we will rebound a bit. This is a liquidity driven event with cheap $'s and printing of money which may never stop (the printing). More $'s to chase asset's = higher prices. Banks are not lending, they are putting their money to work in the equity and bond markets...i.e....the rally. All about the spread. So, when TARP winds down and rates go up....that is when YOU SHORT the equity markets. Equity markets are still in bull mode until then. And now, the best play is to short the 30-yr (ZB). Fed's can "try" to control the short end of the curve, but they have no control on the long end. Other play is to short the EUR/NOK. Will play out nice.
This rally has gone on quite a bit longer than the 1930 rally: a full year vs. only 4 months. I don't think the two rallies are comparable. A bear market rally shouldn't last a full year.
Well, the reason why this rally is longer is because FED is working much harder than in 1929. They printed too much money and got more heavily involved. However, the problem is the more FED intervene the market, the more distorted the market will be, and eventually leads to a much bigger disaster.