* It was Turnaround Tuesday in the global financial markets as stocks are recovering from 2 days of carnage following the surprise Brexit vote in the U.K.
* The Dow was up almost 270 points today, NASDAQ up about 97
* But really the markets got beaten up the last couple days
* The smallest bounce was from the banks, which have been beaten up the most
* So they had the biggest drop and the smallest bounce
* Which really shows you how weak that sector is
* It couldn't even manage much of a dead cat bounce
* In fact, the carnage in, particularly the European banks is much bigger than it was during the financial crisis of '08
* This really shows you how much more levered up the banking system must be, thanks to all these years of QE and negative interest rates
* And of course, how much farther behind can the American banks be from their European cousins?
* U.S bank stocks, too, were hitting 52-week lows yesterday
* I still think there's a lot of carnage coming
* Some banks may be in a position where they are going to have to raise equity, which means they'll have to sell stock
* Clearly the market is not going to like that
* But again, everybody is blaming this on all the uncertainty surrounding Brexit
* To me, if we had a healthy financial system, if the markets were sound, and prices were based on fundamentals
* Would it really make that much of a difference if the UK were in the EU or not?
* What is being revealed here is the fragility of the whole system that is being propped up artificially by the banks
* By cheap money, low interest rates - everybody is speculating
* And everybody is assuming that the powers that be, whether it is the politicians, the governments or the central banks have everything under control
* It's a big put out there and nothing can go wrong
* And then when something does go wrong, then people get nervous
* The wake up and say, "Wait a minute! Maybe it's not as safe as we thought!"
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