If you think this is the last capitulation, you are dreaming....

If you think this is the last capitulation, you are dreaming. This one has a long way to go and frankly anybody who thinks this is a buying opportunity at the moment needs their head read.

I heard a figure quoted on TV a couple of days ago that 7500 homes in the U.S. are being foreclosed on per day. The U.S. property market is in a death spiral and it is taking down mortgage lenders, big banks, brokers, consumer confidence and employment with it. It's not going to stop for a while.

Bernanke is between a rock and a hard place - lower rates and the dollar collapses and inflation goes through the roof, raise rates and the economy collapses.

This is all the long term result of Greenspan lowering rates to next to nothing after 2000. He thought he could stimulate the economy without any side effects. The result can be summed up with two very American expressions -

"There's no such thing as a free lunch"

"What goes around, comes around"

Unfortunately, anyone who is hoping for a quick return to a bull market to save their positions is in for a rude awakening.