Shortly before 3PM on May 6th of last year, I was stunned to watch the Dow drop almost 900 points in minutes during the now infamous “Flash Crash.” Much studied since then, we have been assured the new market breakers would prevent that from happening again.

Shortly after 11AM yesterday, I watched the Dow drop almost 150 points in one minute and worried it might be Flash Crash II, but it was not. Apparently, the EU Energy Minister intimated nuclear tragedy was inevitable in Japan, and the market over-reacted (as it always does).

But, it revealed how nervous this market really is. Analysts debated whether correct news of actual meltdown would produce a 1,000 point drop or a mere 500 point drop. Disturbed by its own fragility, the market continued down, with the Dow closing down 242 points.

Last night, the Japanese market was down again but not badly. Europe is up, and futures suggest our market will open up about 70 points. But, don’t believe the futures anytime soon. The market is not driven by economics nor earnings nor technical chart nor even geo-political problems. It is driven by headlines!