"Fear both real and imagine hangs heavy over Wall Street this coming week, but, remember, Henry Paulson at the US Treasury and defacto head of President Reagan's 'Plunge Protection Team' along with Ben 'Helicopter' Bernanke are working day and night to keep the cogs and wheels of Wall Street moving along. And, remember, they do have the POWER of the US Treasury to support, defend and rally the US equity markets, so long as they control the printing presses.

I like taking a contrarian view. Obviously, the mainstream view today is that the entire financial market is at risk. I believe that the financial market is always at risk, with the crooks in Washington, inflationists at the Fed, and manipulators at the PPT. But the chance of meltdown any particular day is low. Chances are that the Bear Stearns collapse will be contained and it will be a mere blip in the long run. In fact, I would still be more worried about sub-prime and muni bond defaults than a Bear Stearns crisis. If Bear Stearns goes under, Goldman Sachs or, more likely, JP Morgan, will simply pick up what remains and the game will continue. All that said, obviously stocks should be worth less now than before the Bear crisis. But the death of the financial market has been greatly exaggerated, again. "

And one other additional comment worth reading specific to the VIX that you may find interesting:

"The VIX has spiked above 30 and is currently at 31.22. A close at this level would be the highest since March 12, 2003. The last two times the VIX closed over 30, Nov 12, 2007 and Jan 22, 2008, the markets hit a bottom the very same day. Most likely, the market will bottom right here. But there is a chance that the market will crash and the VIX will rocket above 40. "

I wonder we will see unfold: a bottoming formation or a further correction to the downside?