The times sure do change fast anymore in the stock market. Just yesterday the commentary was about how impressive the rally was yesterday and the analysts on Wall Street were speculating that the worst could be behind us. We had 
everyone praising the FOMC for the terrific policy statement on Tuesday and acting as if the subprime mortgage problems and the fixed-income market problems were all behind us. What a difference one day makes, as today we saw a huge selloff on more credit concerns.
The usual suspects led the selloff again today with Lehman Brothers (NYSE: LEH) losing 7.2% of its value today, and Citigroup (NYSE: C) losing 5.4%. The financials that seemed so great for the past two days to traders, were back leading the way down again. The Dow Jones Industrial Average finished down 387 points, the NASDAQ down 56, and the S&P down 44. The catalyst was said to be 3 hedge funds shutting down overseas, which brought subprime worries back into the news.
This is more like the reaction I would have expected on Tuesday after the FOMC meeting. The FOMC didn't even change its stance to neutral or an easing bias, which likely means rate cuts are at least a couple meetings away. The fact that the FOMC putting a few words in the statement acknowledging problems in the fixed-income markets and continued housing problems could propel those industries just made no sense.
The fundamentals of the market have not changed in the past few days, this is just the most volatile market in a long time. For the time being I believe there may be more down days than up, but once this cycle runs its course I believe there will be a golden opportunity to buy some great names at bargain prices.
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