THE ABYSS!

We start Monday morning in the black hole. Markets imploding Friday afternoon have set us up for a potentially disastrous Monday. The dow is headed for a 9 handle and the S&P 500 contnues its decent into hell.

Watch volume in this sell off which might be setting up for another one of those powerful reversals at some point; perhaps tomorrow. If we fall below 10k on the dow it will probably set off panic. Crude is down 4 dollars and under 90 bucks. Gasoline is headed for 2 dollars in the futures. A 2 handle on gasoline! And no one will have money to afford it. MLPS go along for the ride of course. I think 190 on the mlp index brings us back to the first breakout back in late 2000-2001. 6 years of upside will have been completely undone. And given the current market conditions is it possible that some MLPS might pass on distribution increases this quarter in order to preserve some capital? Yield spreads are headed to 1000 bps or more in many cases.

No corporate developements and no upgrades or downgrades so far.

The market in my view is making a transition to the reality of a deep recession. And that means asset prices will continue to deflate.