Something Wicked This Way Comes. Is it the Fed? Is it the President? Is it the Treasurer?

Make no mistake about it, there’s real fear and panic out there as markets are dislocating to the downside…. But note that on many charts we are showing 2008/2009 like conditions, something that is entirely inconsistent with the earnings and economic data we’re still seeing: It’s almost as if markets are pricing in a financial crisis that has yet to occur.… I see slowing growth and concerns about a coming recession, all of which is true, but I’ve yet to see evidence of a financial crisis. ( Zero Hedge )

Now there is a spooky line. Yes, it is looking like 2008 looked after it was obvious we were entering a financial crisis in that Stearn Bear market when Lehman Bros died like a dinosaur in an extinction event. It is almost as if the markets now are pricing in the fear that the Fed’s Great Recovery Rewind is going to take us back into the same recession that their Great Recovery attempted to take us out of. (And, of course, it is.)

The Dow lost 1,655 points, or 6.8 percent, last week. That was the Dow’s worst week of trading since October 2008 during the financial crisis. The S&P 500 also lost 7 percent for the week and is now down 17.8 percent from its record reached earlier in the year, putting it on the brink of a bear market. The Nasdaq Composite Index is now 22 percent below its record reached in August and is in a bear market. (CNBC)

Stocks are heading for the worst month and year in a decade right on Christmas Eve. Yes, the market’s are pricing in something the economic data doesn’t fully support — yet — because investors see the shadow of something wicked coming their way. Santa isn’t just bringing lumps of coal; he’s bringing a coal-eating, petrol-drinking, fire-breathing dragon.

“What’s all the running about everyone?” the little boy asked as the shadow of the great dragon slid over him from behind. “It’s a bright sunny Christmas Eve day! We can still play!”

Or as the revised motto (tag line) on this site now says,

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