2008, I have always felt, was just the warm-up. No way of knowing when the main event is, of course, but now is as good a time as any. I voted greater 10% on the reasonable chance that this right now is the main event. If not, I still think we have a very good chance of a shock that produces, if only for a day, a fall to a level more than 10% lower than where we are now.
Why? Trichet lowered rates in July of '08, in the teeth of the then-unfolding mortgage meltdown. He just did it again, in the teeth of the now-unfolding sovereign debt crisis.
I have always maintained that if that man had a brain, he'd be an idiot. He seems to find a different way of proving it almost every day, but in this case, he repeated himself. Probably has something to do with his advancing age...
