THE DROP IN THE STOCK MARKET IS UNRELENTING WITH INVESTORS SELLING ON ANY RALLIES. ALTHOUGH THE UNDERLYING US ECONOMY APPEARS STRONGER, THERE APPPEARS TO BE A DEFINITE CHANGE IN OVERALL SENTIMENT AND TREND.IS THIS JUST THE LONG ANTICIPATED CORRECTION OR COULD WE BE BACK INTO A SECULAR BEAR MARKET?

I think it is a correction and it has just about run its course. Support around 1100-1110 on the S&P 500 is a logical place for the correction to lose steam.

The worry is that the problems in the Eurozone lead to slower growth in the rest of the world or even worse a double dip recession. I believe this crisis will pass in the near future although I expect a trading range market to develop for the next several months as opposed to a renewed uptrend.

I do not believe we are in a secular bear market.

THE 150 DAY MOVING AVERAGE HAS TURNED DOWN SUGGESTING ANOTHER BEAR TREND HAS STARTED. THE TALKING HEADS HAS BECOME TOTALLY PESSIMISTIC.DO YOU THINK ANY BOUNCE / RALLY IS LIKELY IN THE NEXT FEW DAYS.IS IT REALLY POSSIBLE THAT WE LEFT A BEAR PHASE SO SUDDENLY?
CETV HAS GOTTEN KILLED.HAVE ANY OF THE OTHER MEDIA STOCKS DONE RELATIVELY WELL[LESS BAD DURING THIS DOWNTURN}?

CORRECTION:LEFT A BULL PHASE SO SUDDENLY?

The uptrend is clearly shattered and this is a more severe correction than I expected. I think we are due for a bounce as you are right that the pessimism has gotten so thick. When everyone is pessimistic that means most people have sold. SO, yes, I expect a rally in the next few days.

I think bull and bear markets usually end up abruptly so the quick reversal is nothing shocking.

CETV had bad news, is buffeted by the weak euro, and also the problems in Europe likely further delay an advertising recovery. The stock is very expensive on 2010 and 2011 estimates so there is little support. Media stocks in general are falling faster than the market but CETV has been about the worst. Sadly, I think that is deserved.

Yesterday I bought a few things small in the hedge fund. That is my plan for today if we fall sharply again. But I plan to sell those buys on the first bounce.

I do not think we will drop another 10%. I expect a trading range for the summer and early fall from about where we are now to 8-10% higher.

Key to my outlook is that the economy entered this latest "crisis" in a recovery mode. We can endure some new headwinds without falling back into recession.