That said, why does everybody keep asking if “this” is the bottom?  In a word . . . No!

I cannot say it often enough — a financial crisis is much worse than a recession.  Europe is having a financial crisis that may push the U.S. into a recession, but that is still unclear.  The U.S. had a financial crisis in 2008 with the fall of Lehman, and subsequently went into a deep recession.

Even though the U.S. economy shows signs of life, the U.S. stock market is weakened by the European financial crisis.  So, when will the financial crisis in Europe end?  Of course, nobody knows, but here is my best guess:  when the ECB commences quantitative easing on the scale of the Fed.

That is not the best solution.  Here is the best solution:  Give the EU authority to coordinate the fiscal policies of all 27 member nations, plus give it authority to issue Euro-bonds, backed by the full faith & credit of all 27 nations.  Then, make huge cuts in entitlement spending, i.e., make drastic cuts in retirement and health care, which takes more courage than is reasonable to expect from elected decision-makers.  Since this is not going to happen, only the ECB can save Europe.  (Maybe, the ECB should hire Ben Bernanke?)

When that announcement is made, it will be time to get aggressive again.

But, what about the failure of the elected children on the SuperCommittee?  The market was expecting it and is not that big a deal.  However, that is based on the expectation that the draconian budget cuts scheduled for the first of next year (2013) are postponed.  President Obama wants to keep the pressure on Congress to compromise and promised to veto any postponement of those draconian cuts.  That is a hollow threat!  The prospect of pending budget cuts will slow the economic recovery and keep unemployment high in an election year.  The cuts will be postponed.

At 4AM, Dow futures indicated a minor loss at the open.  Now, it indicates a gain of about 55 points.  No, this is not the bottom . . . be patient.