In my "Year In Review" ticker I made several prognostications.

Let's go through the ones that, it appears, we've got "on deck" as either confirmed or very nearly so at this point - just eight days into the year:

• The US will enter a recession, if it has not already done so. It will be consumer spending driven, with its genesis found in the Housing market. The slowdown will become evident once the “real” holiday sales data is posted, and accelerate into the first quarter. A Government Report today claims that we should have actual negative 4Q GDP growth, which meets one of the originating criteria - we now need only one more quarter to "call it".
• Unemployment will increase significantly, rising to north of 5% by the middle of next year. This will of course cascade back into consumer default rates (mortgages, credit cards, auto loans, etc) and cause yet more layoffs. The “virtuous cycle” will turn vicious. The Government claimed we hit 5% unemployment Friday.

Eight days into 2008, we have two predictions either on deck or close. Sheesh - I thought we'd get to April anyway before I could beat on the drum for the first time.

Today's market action put a pole through the Bull's head, then squicked in the hole.

It looked like we were going to bounce this morning. But then two things did in the market - a rumor (which the company disavowed) that Countrywide was about file bankruptcy, and AT&T saying that they are seeing soft consumer demand for wireless phone service.

That was all it took to take the Dow from up 70 to down 230; a swing of nearly 300 points, with the sell-off going basically straight down.

In the process several important technical levels were violated with conviction.

(Note carefully the wording on that denial from Countrywide. I won't repeat it; go look it up.... then contemplate a bit on how "strong" a denial that really was.....)

Oh, there will be bounces between here and the bottom folks. Bet on it.

But - Bull Markets don't behave like this.

We are no longer "climbing a wall of worry."

That has given way to "sliding down the slope of hope."

Oh, by the way - Lucifer is grinning at the bottom.

Here's the Technical!