I would not be at all surprised by another big ugly downleg that could lead to a very bad day.  If it comes, I would expect that it would be based upon a realization that the housing depression and subprime induced financial system dislocations are larger and will last longer than the Street consensus.

I think that rapid Fed cutting will keep that day at bay, but they only have so much farther that they can go.

Anecdotally, I talked to two guys this week that paniced and sold their very large muni bond holdings (all were in very safe locales) due to the margin call induced drop.  They wanted to know what to do with the money -- I said buy gold and gold miners LAST August like I told you.  LOL