Market Musings 10 10 2008

This is a quick morning update after yesterday's blog.

As you all know, we had a terrible day yesterday with Dow going down drafted by 600+ points. Other market indexes followed. It is quite a surprise to me and I expect a huge rally.

But, like all of us, no one knows when the rally 'that will last' would occur. The volatility measured as VIX by Market Technicians is over 60. Typically it is in 20's. So, the stocks are going up and down with higher velocity. This is unsettling to people whose life savings are tied up in stocks.

For at least a month, I have been telling friends that do not use leverage(margin) and sell into cash, if uncomfortable. It is too late to do this now. This is because we are close to bottom and may have placed the bottom for this cycle. The worst is over.

People who have cash should consider purchasing QQQQ or QLD as the dust settles.... Technology shares were down, due to market conditions and not due to change in the technology landscape by new and disruptive technologies.

Best regards...