The pattern forming in SPX is ominous. It is a continuation pattern, and I don't need to tell you what the trend is. F is in big trouble and may not survive. GM is probably not far behind. I hate to say it, but we aren't done going down. I don't know where this ends, but probably another 50 SPX down. Stay away from shorting VIX. I know of two people that blew out in that pit. nitro
IBM getting taken down with overall market. Don't believe for a minute that is fundamentals. Index Arbs won't be denied. nitro
There is going to be a fight and I wouldn't count your chickens if expecting a close in SPX below 950. This is war. Notice the cash DOW leading down, and futures (YMZ8) and cash way out of line. nitro
Look at the dividend yields as of yesterday in the DOW 30: http://www.indexarb.com/dividendYieldSorteddj.html Look at them for the SP500 as of yesterday http://www.indexarb.com/dividendYieldSortedsp.html Now add today's drop to those yields!!! This is incredible. nitro
Remember, cash pays a dividend and someone has to pay that if shorting stocks. [See two posts above] The cash led down during our regular time hours, which means it is redemption or forced selling. No one in their right minds shorts cash instead of futures and have to incur a dividend. Capisce? nitro
Book value on DOW about 2000. That means we are trading at approximately 4x book on the DOW. That is how insane this is. I wish I knew what the book value of the SPX is... nitro
News on MS downgrade on it's long term debt [by SP ?] caused markets to sell off. People are now reacting to any news by shooting first and asking questions later. The FED saw the trauma of allowing LEH to implode caused. I guarantee you this does not happen again to the untouchables [meaning they will not be allowed to fail under ANY circumstance], MS and GS. nitro