Thoughts from Barron's

Michael Santoli of Barron's says "It's ironic that the bullish case f0r stocks begins with global liquidity, and yet quickly segues to a Fed rate cut - necessary, we're told, for multiples to expand as profits slow."

Not a very good case, is it?

Subprime: Will it spread?

Sy Jacobs, interviewed in Barron's says that it will. The mechanism will be the housing market. But housing usually moves very slowly. But it did hit subprime very quickly. Why? Well, how long did it really take? All the damage of the last two months really happened with loans from the second half of 2006. So, it took about six months. How about employment? How long will that take? Let's watch it closely, because it's very hard to tell.