Epic battle between the sellers and the pumpers today. Perhaps it is starting to sink into the thick heads of the bulls that the economy isn’t going anywhere without a well-capitalized credit system. And we don’t have one of those to hand. And that lack creates a massive hole in the belief that these hyper-inflated consumer stocks like Google, RIMM, Apple and Amazon will be objects of desire in the future.

Once more unto the breach, dear friends, once more,
Or close the wall up with our English dead!
In peace there’s nothing so becomes a man
As modest stillness and humility;
But when the blast of war blows in our ears,
Then imitate the action of the tiger:
Stiffen the sinews, summon up the blood.

William Shakespeare, Henry V

The economy was dead already; killed by the collapsing credit bubble. The oil price issue is just the coup de grâce.

Edit: Bears were Bernanked this afternoon, “Give me more power” Ben further expanded his empire by extending discount window lending to Fannie and Freddie. Now they should be subject to bank capital ratio restrictions. Which they won’t be of course.