Supply Side Economics Create Greed

There is a 55% chance of upturn right now. Bottoms did hold in Friday's early a.m. collapse, and traders reported final profits in any open puts. Calls were also profitable for traders that bought on the

downside move at best buy, and sold to tight profits, and we open the week with more win ratios again. In Friday's alert I suggested I could not read the market well, and was growing concerned.

The comments below show the optimism of some other veterans; mine is more muted. I believe the Madoff 50 billion stock fraud that was exposed on Friday could easily just begin to hit the markets as the scale and depth of the fraud is unveiled this week.

To those that fight for free enterprise, simply study the Madoff situation and you'll see how the former head of the NASDAQ perpetrated this fraud, simply because strong government regulations were not in place. Sorry, but supply side free enterprise sounds great, but it creates greed, that left unmonitored creates the situation you are now seeing.

So the jokes that Obama will now create a socialist country of programs and free dollars is the ignorant, obvious. To the intelligent, we have yet again left ourselves no choice but our own printing of money to keep us alive, building a new house of cards.

Bear in mind when I advise a 55% chance of upturn that the odds of successful prediction are slimming, and doing so because the news of the market is by the second right now, and Detroit did not get the money that the Wall Street bankers did.

Mike Gibbons/Breakoutwatch:

The rally remains intact after the market has weathered news of mounting unemployment, falling retail sales and the uncertain future of the domestic auto industry. There is good news in that wholesale and gas prices are falling so inflation is not a concern, but the prospects of a deflationary spiral are becoming more real. During times of deflation what you could buy today will be cheaper tomorrow so consumption and investment falls. Add to that the need to save because of job insecurity and we have the makings of a more severe contraction than we are experiencing already. How much of this is already priced into the markets is difficult to know but we continue to believe the possible returns outweigh the downside risks.