I think it will once again be real estate defaults this fall. The schedule of mortgage resets is currently in a lul but will pick back up late this year and will not peak until mid 2011. This time it will include both commercial and residential properties.

The big problem in the US economy is that there is too much debt. I therefore don't see the consumer taking on even more debt when they are worried about the future. As the consumer is 70% of the US economy I do not see the current rally as sustainable.

I think we will be testing the lows again by this fall.