At approximately 10:05 am EDT, the Dow Jones Industrial Average fell below 10,000 for the first time since 11/02/2004 (the last close below 10,000 was on 10/26/04). As I write, it has dropped below 9,900. The Dow essentially traded between 10,000 and 11,000 from late 2003 to early 2006, creating substantial support in that range. Breaking it is disconcerting.
According to the charts, there is no real support until 8,000. Trading to that level would be the test of our lifetime: an up-trade would signify a triple bottom and a substantial recovery. Failure would point to 4,000.
Markets seldom trade on fundamentals alone. Faith, belief in the system is perhaps the most important component. The human condition is cursed with the inability to appreciate its "now", we don't know what we have 'til its gone. It is easy to believe in the system during a bull market. So easy, in fact, that it is never even discussed. Nobody cares about what is behind the curtain, just as long as there is a bigger fool to pay a higher price.
I have no guess as to when the system begins to heal, years probably. The challenge for us now is to reestablish faith in ourselves as decision makers and construct a new platform for creating and sharing wealth.
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2 comments:
The Dow dropped below 9,800 after this post was submitted.
The low print on the Dow so far is 9,530.38
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