When you see a dramatic change in the DOW it is nothing particular that causes it but it is a reflection of the amount of speculation that is built into the current pricing. I believe the fair value of the DOW today is around 8000 +/- 300 points… even then I may be generous in the event that the FED will increase interest rates eventually and IF Consumer spending creates demand the amount of investment on plant/Equipment and labor will significantly affect the EPS and dividends thus a double whammy on stock prices.
I have frefained in making predictions sine 2009 because of the illogical actions by the government and the Quantitative Easing. IF QE 3 takes place then we should NOT expect a major change just a continued extension of the current maket.
I am preparing a piece to publish soon .. one that will be considered economic heresy.. but that is the type of planning I do.. OUT of the norm and changing the Paradigms that contribute to the problems. Radical for some.. but NOTHING that has been tried so far gives me any indication that it will solve the dilemma we are in economically