This wonderful chart below (courtesy of Doug Short) shows that not a single time in history the stock market did not mean-revert (trend mean), after a sharp decline. A lot of people argue ‘this time is different’ because of the Fed’s extraordinary actions and Obama’s big stimulus plan. I wonder how in the past the policy makers had done anything different: didn’t they also try to stimulate, but with no avail???

Implication: short the market, still.