More Tricks Before Treats

Yesterday's decline into 1487.95 left a lot to be desired for the bearish case. It was a sloppy looking wave, had no gusto, and felt half-asleep. I'm not sticking up for the rally either. But I think there may be a little left in it, maybe 1510-1513.

The chart above attempts to explain why I think we're in a correction, and why it might have a few tricks left. It's quite possible that -- barring a strong follow-through rally today -- once the bounce completes, that another three-wave sequence takes place. 1450-1470 could be the target zone. This zone could be tightened up after the a-b leg occurs.

If you're interested as to why we have such precarious banking system throughout much of the would, look no further than Dimon Says Banks to Have More Capital Than They Can Use

Banking analyst Mike Mayo asked Dimon a reasonable question during a JPM investment conference:

“What I hear UBS saying in their presentations is, ‘If I’m an affluent customer, I’ll feel a lot better about going to UBS knowing that they have a 13 percent capital ratio than another big bank with a 10 percent ratio,” said Mike Mayo, an analyst at CLSA Ltd. “Do you agree with that or disagree?”

Dimon countered, “so you would go to UBS” rather than JPMorgan?

“I didn’t say that,” Mayo responded. “I said that was their argument.”

“That’s why I’m richer than you,” Dimon said, drawing laughter from the audience.

God forbid that Dimon should have to discuss capital ratios with an astute analyst when he runs one of the most levered banks in the world -- backed by OPM.

Other People's Money that he's not even on the hook for. They are.

I would never deposit a dime at a bank run by nothing more than a street punk, and it's a mystery why anyone else does.

Arrogance has no place.