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Today's 362 point sell-off is a reaction to yesterday's Fed Statement, High Energy Prices, a CIBC warning that Citigroup (C) may have to cut its dividend, and the REAL possibility of a recession. The first thing irritating investors is the Fed's policy statement that said " economic and inflation concerns were equally balanced" which simply means don't expect any more rates cuts in the immediate future. Wall Street is scared if the Fed does not continue lowering rates, the economy will fall into recession, and the sub-prime/CDO market will remain in turmoil. In reality, if the Fed continues to lower rates, a recession will happen anyway since a falling dollar and high oil prices will continue to take disposable income from consumers. I found yesterday's news on MasterCard (MA) quite interesting. The stock soared 32.76 points to $189.91 after profits increased on a boost in cardholder spending. Not to be a skeptic, but this morning we received news that home foreclosures doubled from a year ago. Since consumers home equity has essentially dried up (household ATM machines), one can assume that home equity extractions have been replaced by credit cards.

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