I agree the glaring bargains are now gone... so now we are...

I agree the glaring bargains are now gone... so now we are roughly back to where things were the subprime scare hit, how much further immediate upside is unclear.

But the significant move down is also unclear. Why? Subprime? The market seems at least as excited aout a possible interest rate cut as it is worried about the credit tightening. And don't forget the current reporting season, although somewhat overshadowed by the events of the last few weeks, has been stellar.

In short, I think it will take a bit of time for things to pan out to determine the next macro direction. In the meantime, choppiness, and local developments will drive markets. Fundamentals do not suggest that stocks are particularly overpriced at the moment.

Developments in China may hold the key to what happens next.

-Mark