THE BULLISH VIEW. A Short Bear Market? I can’t rule out that 2007/8 will turn out to be similar to 1987. A major financial glitch which doesn’t morph into a recession. Ed Hyman professes this view and with the utmost respect I have for him, I bought this view for awhile. Until the “overwhelming” bearish evidence made me go back to my bearish views last November. But now, we’ve basically seen a bear market occur since last July. Maybe it will be a short bear market and one without an actual recession involved. This has happened in the past. This, more bullish possibility, came back into my head yesterday based on the Fed’s recent moves and today’s historically low interest rates. Yesterday’s big rate cut plus continuing low long term interest rates, as shown by the 10-year benchmark US Treasury bond at an amazing 3.48% is allowing Americans to switch their ARMs into fixed rates mortgages without getting blasted by ballooning mortgage resets. If this is happening wholesale as I assume, and the anecdote above about a recent refinancing is some evidence that it is, lower interest rates could prove to be a true panacea. Schwartz View: If many bears start seeing things this way, maybe we’ve seen the worst of this market decline. Or at least we may soon be embarking on a substantial secondary bear market rally. With that in mind, and the market’s response yesterday saying the consumer and the economy is going to be helped big time – with rallies in REITs, retail, banks – I covered some shorts and am now watching for what happens. Maybe we’re approaching a turning point back up since we’ve come down so darn fast, and from the looks of US futures as I write, we’re coming down just as fast again today, maybe we’re getting close to some type of bottom, say at the very least a temporary turn back up.