Time to Seek Out Yield

 | Sep 22, 2011 | 7:18 AM EDT  | Comments
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Everyone is, indeed, selling everything. Didn't we see this before? Except then we were in better shape to handle it.

The last time we fell like this was before the six-and-a-half weeks of turmoil that put a dent into so many companies' forecasts and earnings. The last time we fell like this we had downside risk but not "significant" downside risk.

We just don't seem to be set up this time for the bounce that we've gotten so often, at least not from these levels.

I think today will be a day defined by people talking about how Europe is down 20% and therefore Europe is in a bear market, so won't we have to go into a bear market? It will also be defined by the fact that NOTHING is going up. Everything is going down, the exact disaster scenario that Richard Ross, a terrific technician from Auerbach Grayson, outlined to me the other night for Mad Money. In this scenario, the currency of the emerging markets -- oil and copper -- plummets, the euro spins out of control, the dollar holds up, to most of our chagrins, and stocks just get crushed.

The saving grace of this merciless scenario is that it happens quickly.

I cannot be as bearish as Richard because I find that the Fed has told you "look we are not going to let ANYTHING compete with stocks with good yields." So, at least when the averages take everything down, there is more than a port in a storm. There is an actual place to make money.

But there can be no lines in the sand because the foreign banks and Greece are still on the red-hot griddle and we don't know which one or ones could be burned to a crisp.

Yield.

Otherwise, well, yield.

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