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I think the depth of the drops-- the worst two consecutive days since the crash in 1987-- speaks volumes about the level of fear. It's not just the economy, which people know, and have known, is tanking, it's the fear about what the new liberal regime might do to their wealth and financial security.
Investors are being proactive. The wealthy are cashing out and putting money overseas. They're locking in capital gains. They're converting riskier assets to safer ones. They're rotating equity categories to align their holdings with Obama's platform. They're Obama-proofing their portfolio, as best they can.
And all of this is forcing funds to liquidate holdings, feeding a downward spiral. Volatility is the name of the game these days. There are no safe havens and all the news is bad.