Alpha Bank Boards FAILboat

Alpha Bank & Trust was seized by federal regulators today, making it the 16th U.S. bank to be closed this year, the largest one year total in 15 years. The cost to the FDIC fund is estimated at approximately $158 million.

National City Bankcorp declined a ticket on the failboat and agreed to be bought by PNC Financial.

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In an emergency meeting today, OPEC ministers agreed to cut oil production by 1.5 million barrels a day. Crude fell 5% to $64.15.

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The U.S. Treasury is contemplating expanding it's liquidity injections to include insurance companies.

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Wild swings in global currency markets set traders on edge today. Kathy Lien, director of currency research at Global Forex Trading in New York, said the moves seen in the last few hours of trading on Friday "are what we typically see in a quarter."

The currency volatility is exacerbating the shakiness of equity markets, especially in emerging markets that have already been bludgeoned by plunging commodity prices. The central banks of Brazil, Mexico, Russia, India and Hungary were forced to sell their dollar reserves and raise interest rates to defend their currencies. The Euro and British Pound fell sharply against the U.S. dollar and Japanese Yen.

Overseas equity markets tumbled on Friday. Great Britian, France and Germany suffered losses of 7% - 8%. Japan, Hong Kong, India and Russia were down roughly 10% each.

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The U.S. equity market futures were stopped limit down this morning, when 'bid wanted' received no such bid. So, time out and everyone just calm the fuck down. When the market opened, the Dow fell instantly over 5% but then recovered a bit. By the end of the day the DOW and S&P were both down 3.5% to 8,378 and 876 respectively. The NASDAQ dropped 3.25% to 1,552.

The U.S. dollar gained against all major currencies except the Yen. In the face of dollar strength, gold climbed higher.

As the central bank intervention increases, so does the volatility.

I'm afraid that we're nowhere near the bottom. Repeated 90% down volume days with no real recovery in between. The market is due for a very sharp rally, still selling pressure is actually increasing. There is no pressure to buy. A 10% down day is coming, and then another. Will the Dow drop to 5,500. I'm afraid it will. If it does, the bargains will impossible to avoid. A monkey will be able to make money.

Will the Dow yield 6%? It has before. In October of 2007 it took 19 ounces of gold to buy the Dow. It currently takes just over 11 ounces. Will an ounce of gold buy the Dow? It did as recently as 1980.

In the ongoing battle of weak hands vs. strong hands, the weak hands are the leveraged funds. They're being forced to liquidate at all costs. This is the mother of all margin calls. The strong hands are unleveraged, without margin and holding cash. The Chinese water torture is excruciating, but the buying opportunity of a lifetime is coming. Could be next week or next month or next year.