"yike.. so much for the high flying Nasdaq tommorow."
May not matter, at least temporarily, if there is good news out of Europe tomorrow -
http://blogs.reuters.com/felix-salmon/2012/01/18/greeces-game-plan/ (removing uncertainty about
disorderly default in Greece; and remember, LTRO seems to really have taken palpable fears of a Lehman moment in Europe off the table). IIRC, January 20 was supposed to be day European banks submitted plans about how they were going to recapitalize themselves, too (?)
China may also be coming in for a soft landing (
http://seekingalpha.com/article/319907-unofficial-money-fleeing-china), U. S. economic recovery appears to be strengthening (2% domestic GDP growth may not be ideal, but I have seen numerous commentators on tv previously talk about how companies can still be quite profitable in such an environment), housing market may be bottoming...
Whether or not Monti can get
real economic and political reforms through Italy (liberalization of the economy to promote real growth, not just actually starting to collecting some taxes from vast underground economy now / extricating political parasite class (mafia too?) from sucking lifeblood out of economy - there was Washington Post article about how Italian MPs get $15,000 per month and car expense for parliament is like $1 billion per year there) may be real
x factor* right now because this might determine whether or not Germany is willing to do what it takes to keep Euro together (
http://www.testosteronepit.com/home/2012/1/17/the-old-europe-is-not-an-option-for-germany.html)
Bear case last year seems to have been more predicated on visceral fear of a repeat of 2008 Lehman type meltdown of financial markets, this year maybe it is more concern about economic fallout of breakup of European Union / Euro, with significantly diminished but still conceivably possible outside chance of a financial accident leading to worldwide recession.
* That, or maybe if oil suddenly spiked to $150 if war with Iran broke out.