Good Monday all. We're getting more of the same type of price action already this week that we've been seeing for a good while now. The markets moved lower at the open on weak retail sales suggesting the economy is trying to work its way back to 2008 status. We haven't had three consecutive months of weaker retail sales since we fell off a cliff in '08. However, within an hour, the market reversed course and wiped out the early losses suggesting it was no big deal. Why? Because it's expected right now. Additionally, the IMF (International Monetary Fund) came out this morning and revised global growth forecasts lower. They cited Europe as the controlling factor for the near-term suggesting that if the ECB (European Central Bank) doesn't start easing monetary policy, things could get worse across the pond. Do you really think the ECB isn't going to ease monetary policy when the IMF says that's what they need to do? Not a chance. Europe isn't going to want to take the blame for an economic meltdown. Again, more expectations to bake into the price of the markets. If you're trying to make sense of it all, there's one very big fundamental difference between what's going on now and what happened in '08. We're expecting it now. When the markets have the opportunity to foresee and therefore forecast, data gets priced in, the information is absorbed and the markets have the opportunity to price themselves accordingly. That is an extremely major difference in the way the markets will trade, and subsequently behave. We don't think it's rocket science when we hear the economy continues to suffer. We're all privy to the media's spewing and focal point of lagging economic data. As a matter of fact, the more the economy suffers, the more likely we get QE3 here at home and abroad, which will likely spark a rally we can all bank on. If and when we get QE3 is the big question. Of course there will be a day of reckoning with all of this quantitative easing, but we've talked about that fact enough for you to know it could take a few years to work its way to center stage. The repercussions of quantitative easing isn't anything I'd be overly concerned about for at least a good while. Yes, we mentioned Friday our mid-term outlook for the markets, from a technical perspective, is for the markets to move lower before finally staging an investable rally. We also mentioned Friday that the VIX, which is the major fear indicator for the markets, has been extremely tame of late and even that makes perfect sense. You've got traders and active professionals in the industry basically saying they're not concerned, but the average retail investor is pretty much scared, for lack of a better way of putting it. This creates an interesting divergence and dynamic between retail investors who are scared and those professionals being potentially overly optimistic. I suspect we'll likely meet in the middle somewhere before it's all said and done. Without things at least starting to appear even more dire than they already are, I don't think the Fed is going to pull the trigger on QE3 so quickly. Will the lack of Fed action be the catalyst for the markets to move lower? Possibly. Are the markets going to simply start moving a lot higher from here on the anticipation of QE3? Possibly. With that being said, here's a few potential outcomes for you to consider as we work our way through the Q2 earnings season and upcoming economic data. We'll start with what we believe to be the most likely. First is, earnings across the board suggest weak performance in the back half of the year and the markets move lower. The Fed then throws the markets a lifeline, employs QE3 and the markets rally. Second, the ECB takes action and wherever the markets are at that point starts to rally. Least likely but possible, earnings start to surprise to the upside and the markets take off or the ECB stands pat and says things just aren't bad enough for us to act right now, and the markets jump ship for another healthy pullback. We're just living in different times. More than ever before, we're relying on our government to come in and save the day, which they have and will likely continue to do. Why should it be anything different for the time being? The perception for now is that it has been working and we all know what the power of perception can do for the markets. Right or wrong, we now live in a World of days and weeks as opposed to months and years. Back in 2008, the retail investor along with many of the World's largest brokerage firms didn't see it coming. That's why things imploded with such a fierce reaction. Everyone was bumping along dancing in the fields and smelling roses. Then wham, the carpet was pulled out from under most everyone. That's not likely going to happen again real soon, but trust me, at some point down the road, it will. Greenspan calls it kicking the can down the road. For now, as long as everything is somewhat predictable, we're not going to hop on the doom and gloom train so many others have seemed to adopt. So, even though we mentioned on Friday our mid-term outlook is for the markets to move lower before we stage a new leg up, don't get that confused with the thought of a total market disaster. There's a major difference between the two styles of thinking.