The Edge of Night

I keep looking for something I can't get
Broken hearts lie all around me
And I don't see an easy way to get out of this
--Cutting Crew

Back in mid September I opined that it 'felt' like markets were edging over the abyss. Subsequently, at least $1 trillion worth of intervention has been created in attempt to stem the selling and revive comatose credit markets.


Thus far, those efforts aren't working. After yesterday's -350 Dow day (-800 at one point) and -500 today, it feels like we're staring into the abyss once again. In 'normal' market contexts, severely oversold periods like this one suggest a fade trade in the offing.

But these are anything but normal times. The Austrian in me wonders whether the inevitable time--where pent up market forces can no longer be restrained--is finally upon us.

An inflection point lurks ahead. Hard rally, or severe dislocation, seems eminent.

no positions