Once again, the stock market is on the verge of collapse. If it does collapse, the DOW could go to 4,000. The US government and the world have performed many "stick saves". Each time the market reacts for less time before down turning once again.
If the stock market opens down Thursday AM, this may be the next major leg down.
Its hard to say where the bottom is, but I believe the bottom will be in 2009, DOW 4,000 - 5,800 range. In the near term a "collapse" maybe DOW 7,000-7,400 and able to find a local bottom.
Unfortunately, if I am correct, DOW 5,800 is 1996 levels is really like 1980s levels once you take into account inflation. The "buy and hold" for the long term mentality of America may finally become broken next year, if holding 20+ years is not "long enough" to make a decent buck.
I may have been early with the gold miner post yesterday. Buying ANY Stock, including "gold miners" will not be good in a deflationary collapse. Cash will be king. I'll keep you posted as best as I can as this unfolds.
UPDATE 8:30 am.
Multiple "stick saves" out today, everyone wants to pitch in.
Federal Reserve - Bernanke says he sees "new ways" to ease credit
Senate - Senators seek guidelines to ensure banks boost lending
President - Bush administration floating plan to help directly borrowers
Former Fed Res - Greenspan states tighter regulation needed
Hopefully the USA can staff off a collapse......... until next year.
There is a slew of bad news daily, at this point its almost mute to post. If you want to see bad news real time daily, click here for high level list.
UPDATE 12:50 PM
Mish has a great article articulating the "crash count" of the stock market, and compares it to the Japanese stock market.