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I must say, after reading Alan Abelson's latest weekend rendition of Goldilocks and The Perpetually Un-objective Three Bears, I was amused. If you know the man, personally, please send him my regards... from calling China to the USA short the whole way up, the last 6 weeks have really been embarrassing for him. Hopefully he's enjoying being right here for a few hours of trading.

The New Reality is this: Bear Bubbles are equally as relevant as those that we called out as liabilities for the Bulls 18 months ago. Bubbles are measurable and so are the walls of worry that are associated with them.

Abelson called out a comment this weekend from ex-Merrill, ex-Banker of America, about to be ex-Bear Bubble boy, David Rosenberg that challenged we men and women of the objectivity gridiron to "call us when claims fall below 400,000"...

Understanding that Rosenberg is both a fellow Canadian and a former fellow Bearish friend of ours, understand this - Rosenberg is one of the many Bears who remain un-objectively bearish as he cashes in his new chips with a new firm and a new contract...

David, I'll definitely call you when we/if we ever hit 400,000 in claims, but will you call me if the SP500 hits 1051 on the way down to your target?

Bubbles work both ways. So does managing risk. If you think that being short a 28.6% six-week move in the SP500 didn't require a risk manager to show you charts like this, I can tell you that whomever's money you are managing may think otherwise. Perpetual is not a real risk manager's stance.

This past week's falloff in jobless claims fell sharply to 610,000 (see chart). Most importantly, this print snapped the immediate term duration (4 week moving average) by a considerable margin (that's the yellow line in the chart at the 651,0000 marker). And it reminded all of those who continue to say that this market is "overbought" that that Bear Bubbles remain misunderstood.

Keith R. McCullough
Chief Executive Officer

Chart Of The Week: Bear Bubble - ffffffffffffffffffffff