POTC sent out an alert many weeks ago about the dislocations that might result from the bursting of the oil bubble, and with the Ospraie news we are VERY cautious of entering ANY long positions, perhaps only for day trades. As the cockroach theory states "where there's one, there are many more lurking." This is exactly why POTC asks readers to obey the 11 Commandments, as these types of events usually come out of left field, and the 2nd Commandment becomes more relevant. We are now very concerned with how the financial sector digests this negative news, and we urge traders to be overweight cash. In addition, the ISM coming in at 49.9 foreshadows a grim Unemployment Rate this coming Friday, perhaps above the 5.7% forecast, and that would be devastating to most long positions with positive betas. As much as we hate recommending stockpiling cash, it's at times like these that cash will allow you to get some sleep. Even if there is a delayed market reaction to this news, we are very worried about the domino effect this may cause in the weeks ahead, especially as more hedge fund blow ups hit the wires. The Psychology of the Call team.