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9:00 AM EDT, Friday, October 2, 2009: So is it all over? It peaked on the morning of Wednesday, September 23. It's been all downhill ever since. Though the charts show "only" a 4% drop, it feels a lot worse. And yesterday's 203 point fall (2.09%) on the Dow and 27.23 point fall (2.58%) on the S&P 500 suggested that it was all downhill for the rest of the year.

The media took the stockmarket plunge as an opportunity to open up the "no jobs" discussion -- endlessly. If you don't have jobs, you don't have consumer purchases and, hence, an economic recovery. I suspect most of my readers are insulated -- to some extent -- from the miserable employment situation. But I sure we all have friends who are seriously hurting. We have friends whose unemployment has run out and whose spending basically ceased. No clothes, no restaurants, no theater ... no nothing. For many people, there are no jobs. Even pro bono employment is impossible to find. That failure hurts the ego.

For stockmarket gurus, like Richard Russell, yesterday was affirmation that cash and gold are all that make sense. Russell wrote "The decline from 2007 to 2009 did something unusual. It shattered the long rising trendline that I have been watching with awe since 1980. And I ask myself, is this the beginning of the big bear market correction, the move that will correct 27 years of generally rising stock prices?" To emphasize his point he published this chart:

Russell continued:

Turning to Elliott Wave theory (which I haven't done for many years), we know that most bear movements tend to take the form of an A-B-C pattern (an initial A wave down, a B upward correction and a final C wave down). We also know that following crash patterns (such as 2007 to 2009), it is usual for the price movement to recoup half or more of the losses of the first major decline. If the Dow was to correct 50% of its 2007 to 2009 decline, it would rally to the 10300 area. We're not there yet.

But what I'm thinking about is -- suppose the decline from 2007 to 2009 was the "A" leg of a major bear market? Then the worry is that following the current B-leg advance, we face the "C" leg of the bear market. The C leg would almost certainly see the Dow and most of the market break below the March 2009 lows.

That possibility has me mostly on the sidelines with cash and gold.

You can't predict Mr. Market. But the few brokers and others I spoke to yesterday all felt sure that this year's run-up was over. This was their "gut feel" They were all eyeing shorts -- shorting overpriced stocks.

The longer-term chart tells a different story:

There was a pretty gruesome drop beginning in the middle of June and extending into the first week of July. We're not there. But then, stocks are not cheap. Or are they? I went on Yahoo! Finance's stock screener last night and asked it to find me stocks whose P/E ratio was between 5 and 10. I found 376. Some of the names I recognized included Brinks, Bucyrus, Chevron, Constellation Energy, Del Monte, Marathon OIl, Penn West Energy Trust, Tesoro, Wellpoint and oodles of banks.

Hot names like Apple and Google are way higher -- 31 and 35.

How about the Dow Jones 30? I looked at the list and sorted by P/E ratio. Nothing stunningly cheap here

All of them did miserably yesterday. Here's Bloomberg's chart::

In short, we're at some sort of turning point. I don't like what I see. But I'm not issuing a "Sell Everything" recommendation, as I did in November, 2007. Let's watch this for a day or two.

Meanwhile STEC sucks big-time. It's broken down. The shorts are in control. This chart comes from According to reader Tom Diroff, " they are pretty good at this stuff."

The last time I spoke to STEC's president, there was a panic and frustration in his voice -- as though a world totally outside his world had engulfed his company. And he had zero idea what to do. His stock had become a plaything for traders who were putting out stories that STEC was being overwhelmed with new competition, earnings were under pressure, the stock was overpriced and about to take a thunderous fall. STEC did a secondary recently at $31 -- in which a bunch of insiders sold a wad of their shares. That should have told us something. Maybe.

It looks like the stock will open around $26 today. The BIG lesson here is with "hot" (it was once) stocks, you need to go with the flow. Ultra-short trades are all that make sense. Make a few shekels. Get out. Don't stay in for longer than a day or two.

I can see one of these for me.

And for me? He was a good husband, a wonderful father, a passable tennis player, but a bad stock picker.

In case you missed this wonderful cartoon:

There was blue sky earlier this morning in New York. But now it's gray. I wonder what that means?

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads on this site. Thus I cannot endorse, though some look interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Michael's business school tuition. Read more about Google AdSense, click here and here.