Selling pressure in stocks and commodities, and big gains for bonds and the yen. I understand the selling pressure in stocks, but the flight to safety trade seems a bit overdone to me. Not because there isn’t a need for safety, but because there is going to be big selling pressure in both yen and bonds. Yen because the Japanese exporters are getting killed, and after yesterday’s humongous move the BoJ finally spoke up. I guess they’ve been (understandably) unwilling to buy the USD to intervene, butat some point they are not going to be able to resist the pressure for competitive devaluation. Bonds because, well they’re Treasuries I suppose. Despite the rising talk about a second “stimulus” package to add to the $1.8 trillion deficit, despite the continuing international pressure to replace the dollar as the reserve currency, despite the rising pressure to bail out the over-spending states, despite Obama’s pressing ahead with his health care plan without regard to his failure to rein in costs, some folks still have faith.

There appears, however, to be a less-than-discreet rush for the door in financials.  PIMCO pulled out of the Treasury’s PPIP, a less than encouraging sign I would think. The KRE regional bank index has been noticeably weak, consistent with a likely coming Armageddon in commercial real estate. The BKX has started to catch up on the downside the last few days. This is not a good sign for stocks in general. Well, not good for the bulls that is. Personally, I find it quite encouraging.