Look at a long term chart of the S&P500 - it made a double top in 2000 and 2007. If history repeats its self, it will bottom around 750 in 2010. That’s around 40% lower than where it is right now. No market goes straight up or straight down so it’s possible to make money in down markets on counter trend rallies – but it is not easy. The scenario is similar to what happened in 2000 when the techs lead the market into bear territory after coming out of a huge bubble. This time it is housing and the credit markets leading the bear after the huge real estate bubble from 2003-2006.
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