1) The Markets Are On a Knife Edge. All global asset classes are within a hair’s breadth of completely breaking down.

The S&P 500 sits perilously on its neckline. Just below here there are a ton of sell stops that could pare 5% off the index very rapidly. The more volatile and leading emerging market ETF (EEM) has already broken this key level. Look also at the euro, which has been marching in almost complete lockstep with stocks. It has crashed through the 50 day moving average, and has so far struggled unsuccessfully to recover it. The flip side of all of this is the (UUP), a dollar long against a basket of currencies, which appears to have entered new bull market territory.

What positive surprise is out there that could possibly hold things out there for a few more weeks or months? I can’t think of one. What surprise negative is out there that could cause the whole house of cards to collapse. I can think of a dozen. Only Ben Bernanke has the power to stick his finger in the dyke, and right now he is keeping his hands in his pocket.

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Ben, Where are You?