After a massive sell-off last week, the stock market is beginning this week with another ugly morning. The S&P 500 is down nearly 2 percent after two hours of trading.

Sometimes, during stock market panics, there are “safe haven” trades such as bonds or precious metals, but we are seeing none of that today, with bonds, gold, silver, and almost every commodity down on the day.

So there is no “flight to safety” today but rather an overall reassment of fair prices for financial assets and commodities based on Federal Reserve Chairman Ben Bernanke’s recent comments suggesting that the Fed may start cutting back on asset purchases next year.

There is an initial problem that the market, the bond market in particular, is addicted to the financial heroin of cheap/free money, and these DTs will be difficult indeed.

But there is a secondary problem: The Fed has been wrong about just about everything, including their claims of how beneficial their financial manipulations have been. And now they are suggesting they will indirectly raise interest rates because they expect a much better economy — but the market disagrees with the second half of that assumption and now worry that the Fed will raise rates while the economy is still handicapped by bad fiscal policy, over-regulation, and the twin disasters of Obamacare and Dodd-Frank.

Meanwhile, as interest rates rise in anticipation of future Fed actions, it is causing a massive deleveraging across the globe, sending almost every major bond and stock market into a tailspin simultaneously. When all assets correlate, as happened for an extended period of time during the economic turmoil of 2008, trading and investing are extremely difficult and fraught with risk.

I’m less bullish on the economy than the Fed is, but more bullish than those who are mercilessly pounding stocks in the past week. At some point, stocks will be cheap, and I have expected a sell-off of 5%-10%, but emotions are so high right now that it could well go further than that, and I recommend you don’t try to catch a falling knife.