Ben won't save us yet.

Markets are taking a deceptive breather here before the storm of the Fed meeting, happening imminently. In the choppiness of options expiration week I set up two long bull spreads on GS and AAPL. The former is well positioned to make serious money buying underperforming and distressed debt assets from struggling subprime lenders. The latter is at the beginning of a truly impressive product cycle: AppleTV, Leopard OS, iPhone, etc. All of these products look set for a home run.

That said the spectre haunting the market today is the credit crunch. As I've posted before, declining access to credit from consumers is going to be the thing that spirals this economy into recession. The way to avoid this is for the Fed to ease. It seems clear to me that a contraction of credit and liquidity from the consumer markets would be fairly devastating for everything from corporate profits to asset prices.

If Ben had raised last summer, he could probably safely cut rates now, or at least introduce some friendly language ... but since inflation is still high and labor markets tight, he is boxed in.

It will be interesting to see what happens at 2:15.