The reason this surprise discount rate cut and also new lending line with lax collateral isn't sparking a rally is because everyone saw this coming. Who is dumb enough to short ahead of another Fed intervention? The shorts were scared to death of another possible Bernanke announcement leading to a quick short squeeze like last Tuesday so most shorts covered ahead of the weekend, and even some longs got bold and bought ahead of a possible positive announcement from the Fed and/or Bear/JPM merger. Bernanke is now in panic mode, not that he's ever been the face of calm. He is now officially a slave to the stock market's wants and whims. The good news from this weakness is that it will begin the capitulation phase. Investors will now realize that Fed bailouts aren't going to save this dog and will bail out of stocks. This might put in a meaningful bottom, but only if there is a significant sell off. I am not talking 2%. 5-6% down in a day, something we haven't seen in quite a while. If more bottom callers come in like on Friday, and try to rally it on Monday, all bets are off and we get drips lower followed by quick short squeezes followed by more pain. Got the popcorn ready for Monday's massacre, should be quite a scene.