The market seems to be selling-off on the back of limited bad news imo, apart from the dollar that is.

If you can hold your nerve and apart from any short term requirements to offload poor performing stocks, I have a couple!!, my advice would be sit tight. This does not have the feel of the tech(mining!) bubble at all. Difference being there are a lot of good fundamentals, unlike in 2000 when there were a lot of over rated nothing companies.

just bought some CITE, apparently a forced seller has caused an 80% fall, coming back nicely.

CITE - That's a scary chart!!! Bit like the south face of the Eiger! Very brave, imo.

Rhymes with.....

Closed dow short for now, healthy profit today, short on ftse for tommorrow

NEW YORK (CNNMoney.com) -- A lot of Wall Streeters are reminiscing this week about where they were during the 1987 crash. The more recent tumult - in 2001 and even earlier this year - gets lost in the chatter.

The combination of circuit breakers instituted by the NYSE, and the Federal Reserve's willingness to intervene, means a crash on the level of Sept. 19, 1987 - in which the Dow plunged 22.6 percent on a 508-point loss - probably won't happen again.

Photos

Remembering Black Monday
On Oct. 19, 1987, the Dow fell 22.6% in a single day. Fortune asked 10 Wall Street veterans to share their memories of the crash.
View photos

But that doesn't mean the market won't - and hasn't already - experienced severe mini-crashes that crush investors and roil the markets for days or even weeks at a time.

"Could it happen again? Not to the level of severity as in 1987, but you could see a version of it again," said Kevin Melich, senior portfolio manager at Chartwell Investment Partners.

Remembering Black Monday
Take, for example, the market chaos that erupted in the wake of the Sept. 11 terrorist attacks.

At least on a psychological level, the Dow's 684-point plunge on Sept. 17, 2001, represented a crash. That marked the first day of trading after a four-session halt. The panic and almost across-the-board selling that ensued felt like something of a crash. Among the few sectors that managed gains that day: bomb detection software makers and other defense stocks.

Sept. 17, 2001, still holds the record for the Dow's biggest one-day point loss. But in terms of percentage losses, the drop of 7.1 percent doesn't even make the top-ten list. It was a shock and a panic, but not a "crash."

For many people, even those that don't follow the market closely, a "crash" is synonymous with the devastation of 1929 and, to a lesser extent, 1987.

"I don't think you can set forth any specific parameter of what is a crash," said William Hummer, principal at Wayne Hummer Investments. "It's more of an 'I'll know it when I see it.' "

Philip J. Roth, chief technical market analyst at Miller Tabak, described a crash as what happens when "everyone gets on one side of the market." Roth was speaking at a Dow Jones symposium on the crash and its ramifications.

Thanks to protective measures put in place after the '87 crash, the market has not since experienced a one-day decline of the magnitude of the 1987 crash. The infrastructure was on display most recently this summer, particularly during unusually heavy trading in August, when anxiety about the credit market crisis came to a head.

Two factors protect investors from another crash: the circuit breakers and the Federal Reserve.

Updated quarterly, the NYSE's current rule is that if the Dow plummets 2700 points in a given day - a loss of 20 percent - the market shuts down. If this happens before 1 p.m., the closure lasts two hours. If it happens between 1-2 p.m., the shutdown lasts one hour. If it happens after 2 p.m., the market is shut down for the day.

A 10 percent decline triggers similar measures. The maximum the Dow can lose in a single day is 4050 points, or 30 percent. Should that happen, markets shut down for the day.

The market has never experienced anything like that, but it has seen a series of mini-crashes, including the period after 9/11.

Other examples include: March 12, 2001, when the Dow tumbled more than 436 points in the midst of the big correction that followed the end of the 1990s tech boom.

Two others came earlier this year. On Feb. 27, plummeting Asian markets caused a domino effect in global markets on worries that the period of strong global growth was ending. On that day, the Dow plunged over 416 points.

And on July 26, fears about the collapse of the housing market and tightening of the credit markets sent the Dow falling 311 points.

In all those cases, within a matter of days - sometimes by the next morning - the market had stabilized and traders had used the selloff as an opportunity to move back in.

All are examples of modern mini-crashes. But a true crash on the level of the more famous ones in history would probably materialize today as a series of mini-crashes in a short period of time coinciding with mini-crashes in global markets, Hummer said.

A serious shock to the system would have to happen to cause that kind of reaction, Hummer said. What could cause that significant a shock? Analysts say it would take an international military event or global financial crisis.

However, even the impact of a prolonged market meltdown would be tempered by the second big protection: central banks around the world.

The consumer buying binge is over
True, Ben Bernanke and the other Fed bankers have made it clear that its not their job to bail out financial markets. But they have also made it clear that they won't let markets flounder to the extent that it sends the economy into recession.

That's how the Fed reacted to the tumult this summer, when stocks plunged 10 percent in August in a matter of weeks.

Circuit breakers and other technical aspects of the infrastructure kept the daily declines orderly, and the Fed cut the discount rate, which impacts bank loans, and then ultimately the fed funds rate, which influences consumer loans.

And the Fed was not alone, with banks around the world stepping in to manage the global liquidity crisis by infusing billions into their banking systems.

All of which is likely to continue keeping a lid on, but not prevent modern-day mini-crashes.

"People are more educated now, more inured to volatility than they were in '87, but what we saw this summer was a great object lesson in what can still happen," Hummer said.

Mortgage Meltdown 2007

35 minutes to riches

World's 50 most powerful women

is it just me or does anyone else feel that the markets are about to head sharply lower?
also
does anyone have any thought on the overall implications if US cuts interest rates yet again?

I suspect gold and other commodities will rise, the dollar fall and inflation take off. Other countries pegged to the dollar might also rebel

My feeling (FWIW) is a damned if they do, damned if they don't scenario.
The greenback is weak, so a rate cut could weaken it further out of proportion and be seen as a sign of the economy being worse than anticipated, on the back of an earlier large cut.
No cut could well be seen as dithering and indecision in a nation that demands results now, and further damage confidence.
It just has that feeling about it.

I do too cynic ,look at the price of oil ,and weekness in the doller ,i shorted the dollar yen this week ,closed now ,my balls have gone ,which way now for the Dow ?

probably down; am already holding FTSE short (+ NRK, though that almopst doesn't count!) ...... am in two minds whether or not to liquidate a large slab of my portfolio and/or whether to short any $-vulnerable or house building stocks, notwithstanding that they have already taken a pasting in recent weeks

of course the elliot wave theorists will be saying, 'i told you so...'

added to my FTSE short barely 30 mins ago and already well in the money ... monday must surely be torrid in london

I had to go out today ,was going to short the Dow with a 40 pt stop ,i sat with my finger on the sell button then thought better of it , :-(

i am in danger of getting too greedy on monday by shorting even more NRK

interesting that my shares ususally perform admirably on days that the FTSE drops, think next week might be a tad different though...

ususally, is a word that i invented, it is like usually in many ways although spelt differentially...

twit ... lol!!

Will stocks face another Black Monday?
Stocks to face recession fears, earnings after Dow's Friday slide
By Nick Godt, MarketWatch
NEW YORK (MarketWatch) -- History never repeats itself; but it often rhymes, Mark Twain once said. That's also what many traders and market watchers were left to ponder as the Dow industrials slid more than 360 points on Friday, which marked the 20th anniversary of Black Monday.
On Monday, Oct. 19, 1987, the Dow Jones Industrial Average slid some 508 points, in a broad movement of panic selling which also came on the heels of a big sell-off the preceding Friday.
For believers in cosmic coincidences, this Friday's action might seem foreboding.
"It's a question of market psychology," said Alexander Paris, analyst at Barrington Research. "But are we going to have another Black Monday next week? If I had to make a guess, I'd say probably not," he said.
"Friday's action was not a one-day event, it was something at work the whole week, with worries about the economy, then banks warning on earnings, followed by warnings from the industrials."
Also raising anxiety among investors, the dollar hit new lows against the euro while oil surged to a record $90 a barrel.
While cool-headed Wall Street analysts remain unconvinced that a repeat of 1987 is in the cards -- at least on Monday -- they readily admit that the right conditions might still be in place.
"Can it happen again? Yes," said Paul Mendelsohn, chief investment strategist at Windham Financial Services. "Do I think it will happen again on Monday? No. We can have a couple of days when we lose 2% without a major crash."
On Friday, the Dow saw its losses accelerate in afternoon trade before finishing down 366 points, or 2.6%, at 13,522. The pain was just as bad in the broader market, with the S&P 500 index losing 2.6% and the tech-heavy Nasdaq Composite down 2.7%. For the week, the Dow lost 4.1%, the S&P fell 3.9% and the Nasdaq slumped 2.9%.
But as ugly as the day's performance was, it still paled in comparison with the Dow's 4.6% point drop on the Friday preceding Black Monday. And that day's 508 point-drop represented a 22% plunge for a Dow that hovered above 2,000 back then.
"It's ironic we're down on the day of the crash of 20 years ago, but putting it in perspective, we would have had to have a 3,000-point sell-off today" to match the drop of two decades ago, said Art Hogan, chief market strategist at Jefferies & Co.
Industrials warnings
The day's troubles began when several industrial stocks -- especially Dow components Caterpillar Inc. (CAT:Caterpillar Inc
Last: 73.57-4.09-5.2
CAT 73.57, -4.09, -5.3%) and Honeywell Inc. (HON:honeywell intl inc com
Last: 58.32-2.37-3.91%:HON 58.32, -2.37, -3.9%) -- warned that U.S. economic woes would likely cut into future earnings. Caterpillar chief financial officer Dave Burritt told the Reuters news agency he sees a 50% chance of a U.S. recession.
Following this summer's credit crisis and worries about the housing market's drag on the U.S. economy, Wall Street went into the third-quarter reporting season hoping that global growth would lift the earnings of major multinationals.
But with the industrials' warnings Friday, the market had nowhere else to turn to.
The market had already lost the key leadership of financial stocks, which this week revealed the hefty drag of this summer's credit crisis on their earnings. Citigroup Inc. (C:Citigroup,
SpC 42.36, -1.47, -3.3%) , JP Morgan Chase (JPM:JPMorgan Chase &
JPM 45.02, -0.88, -1.9%) , Bank of America (BAC:bank of america corporation com
BAC 47.57, -1.28, -2.6%) and many regional banks took hits from bad loans this quarter and warned of more to come.
The market had also lost the support of major oil refiners and oil services companies, which are suffering from the rising cost of crude oil.
With the industrials out, "three legs of this four-legged stools have been knocked out, leaving only technology," said Windham's Mendelsohn. "It doesn't mean we've got a disaster coming. But it does mean we can't go up until something changes."

The last time the FTSE100 reached the heady heights of 2006 was in 2000.
The chart below shows what happened then. It took the best part of 3 years before it finally hit rock bottom.
From this, you may well deduce that the present downturn could well be the start of something that will last a while yet.
My own feeling is that the FTSE100 won't begin to recover again until it has first breached 4800 - sometime next year.

you might care to look at the thread i have started re indices

Greenspan says credit crisis was 'accident waiting to happen' UPDATE - AFX
(adds comments about current account deficit, debt levels and protectionism)

WASHINGTON (Thomson Financial) - The financial turmoil that erupted in August was 'an accident waiting to happen,' and would have taken place in some other sector of the market if it were not started by changing views about the subprime mortgage loans, former Federal Reserve board chairman Alan Greenspan said.

'Credit spreads across all global asset classes had become compressed to clearly unsustainable levels,' Greenspan told an audience at the World Bank's International Finance Corporation.

'Something had to give. If the crisis had not been triggered by a mispricing of securitized US subprime mortgages, it would have eventually erupted in some other sector of our market,' the former Fed chief said.

Greenspan defended his decision to lower the key federal funds rate to 1 pct and said the housing bubble was not caused by the US central bank.

'Central banks around the world have essentially lost control over the markets beyond three or four or five years out,' Greenspan said, noting that the long-term interest rates did not rise as the federal funds rate was increased, starting in 2004.

US housing is primarily financed with mortgages based on 30-year interest rates.

Greenspan said proof of his argument is that housing bubbles emerged in nations throughout the globe, where the Fed does not control interest rates.

He asked, rhetorically: 'If indeed, it is short-term interest rates that created the bubble in the US,' then what created the bubble in Europe, Australia and other parts of the world?

The octogenarian also said policymakers should focus on 'the level of debt and not the source of its financing', which too often garners excess attention.

While he said there is an 'inevitable' adjustment coming in the US current account deficit, he believes it is 'not a huge problem.'

Rather, Greenspan said that an increase in protectionist sentiment and irresponsible fiscal policy pose more of a problem to the real economy, which could be 'quite painful' for the US and its trading partners.

corbett.daly@thomson.com