Couple Things To Watch....

Short term:

1) Watch the Baltic Dry Index. It is "rolling over".....in conjunction with the roll over in commodities.
2) The British FTSE and German DAX indexes are rolling over as the US markets roll over as well.
3) Commodities continue to get whacked as all that hedge fund money comes out of commodity markets.......AND....as the dollar refuses to roll over.

Long term:

1) The recent Treasury auctions show that there is a strong appetite for SHORT TERM Treasuries........but the appetite is not nearly as strong for LONG TERM Treasuries (30 years). I have read reports that indicate that China is moving more of their US obligations to the SHORT END (5 - 10 year obligations.....from 20 & 30 year obligations). They don't appear to be lowering their TOTAL value of US Treasuries......but they ARE shortening up on their average maturity.

2) The commercial real estate market is heading towards hell over the next two years as their borrowings come due........and banks aren't lending nearly as much. NOT GOOD. Also, the upper end of the housing market will continue to get ravaged as jumbo resets take hold this year and next.

With all the talk of the Fed expanding their balance sheet by over 1 - 2 trillion dollars...........it is often overlooked that as that balance sheet expansion has taken place, housing has lost 10 trillion dollars....and the stock market has lost ANOTHER 10 trillion dollars. There is......unfortunately......no stopping the de-leveraging that continues to take place. It is a matter of price.....and time..........and NATURAL supply/demand.

3) As financial markets CONTINUE TO DE-LEVERAGE.....all asset groups will be hurt. The only real "safe haven" will be VERY SHORT TERM Treasuries or cash.