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I'm more concerned with the return of my capital than the return on it" -Will Rogers
I am not going to post on the "why" of what's happening. If you read the blog you know my thoughts. If your a subscriber then you really know. This isn't a surprise.
Drunks get hungover, crackheads and heroin addicts jones for the next hit and pay the price, if you bought a boat and ten plasmas with your equity line you are now paying the price. America and the free world is now paying a price for their sins, it hurts, but it's a good thing in the long run. It lays the groundwork for the construction of the next bubble. You won't see it being built, but trust me it will happen again. This is bullish.
This market has been in la la land for a while, absorbing warnings and turning its head at bad news at every turn. This last week we have had a reality check. No mas, just too much nonsense to absorb. Washington, Europe, double dip...you name it.
The market faked out everyone yesterday when it rallied, it ended up being a golden opportunity to let longs out, they took it. Today was a classic risk off deleveraging, hedge funds and other institutions had Margin calls and had to raise capital. As a result, the speculative play in gold and silver got taken off as a source of funds to meet those calls. Gold and silver are liquid, so is Apple $AAPL and they got hit as a source of liquidity. Europe is melting, this wasn't just a few hedge funds and mutual funds just "lightening up", this was hard selling, almost (maybe not yet) fear selling.
http://www.proinvestor.se/index.php?p=debat_post&postid=1005
