Daily Investment Interpretations

February 22, 2011

2011-2-18 (Friday): The markets crashed today. The NASDAQ Composite plunged 77.53 points (-2.74%) to 2,756.42. The Dow plummeted 178.46 points (-1.44%) to 12,212.79, while the S&P 500 lapsed 27.57 points (-2.05%) to close at: 1,315.44. Oil leaped to $95.94 a barrel , while Gold ended at $1,401. The VIX jumped a full 4.37 points to 20.80.
  
 The official reason given for today's debacle is that of the Libyan political crisis. However, the markets have become more and more overdue for correction. What's important now is what happens from here. Market futures are up about 0.2% tonight... enough to support a "dead cat bounce" tomorrow morning, followed by further price erosion. In all likelihood, this is a 3% to 5% pullback, but it has to be enough to scare very smart and savvy professional investors into dumping the premium-grade stocks they've just bought. (Today, the NASDAQ fell 2 % while the S&P is down about  1 %. Right now, the best thing I know to do is to do nothing. When the markets finish bottoming, and have convincingly started back up, that will be the time to start bargain-hunting.