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We questioned Bank of America's (BAC) timing of a deal to buy Merrill Lynch (MER) last weekend, as we figured Merrill Lynch may have gone to single digits if Bank of America didn't make a move when it did. In any free market, the players involved understand that you will never buy a stock -- or even acquire another company -- at the very bottom. The trick -- as always -- is doing your homework and making an educated move at the right time.

We strongly believe that the market should decide who become the winners and losers. Changing the rules to stifle further drops only makes for artificial upside performance. We don't need these kinds of "steroids" for the game to be profitable for many. We need to get back to the basics. No phony trading rules changes to protect the companies that all but bankrupted themselves. This is a temporary fix at best.

If You Stayed Short Financials Into Today, Punishment Is At Hand

Looking at a pre-market quote for Morgan Stanley (MS) up 50%, makes me think about how much money have I left behind in my career as a trader.

Don't get me wrong, I love what we do at, but when the trade is that blatantly obvious, you wonder how big a day it would have been for making mega dollars.

First, let's replay what was happening on that fateful day yesterday. The financials were getting hit hard again. Rumors abounded that deals were not coming together, and that money markets were in danger. But then we get the 1PM announcement about the United Kingdom banning any shorting of financial stocks. The market started to make a comeback, but nothing feverish. If you were short, you had plenty of time to react. Then we started getting anecdotes from companies like Bank of New York that things were fine, so those financials started coming back. Then came the fire alarm about the Resolution Trust -- which started to get the market hopping a bit -- but you still had time if you were short to get out with not as much harm done.

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