You hear more or less serious arguments these days that earnings don't count, that interest rates are irrelevant, that the macro backdrop is a distraction. Otherwise erudite observers use the phrase "melt-up" in their analyses. Melt-up? It can't be a well thought-out market if it is represented by so unlikely an image.

In the final analysis, we might find tactical asset allocation (with futures) creates futures-driven markets just as portfolio insurance did (in combination with index arbitrage). While the market was vulnerable to a "meltdown" in the summer of 1987, however, it might be vulnerable to a "meltup" in the period ahead when this tactical asset allocation tidal wave responds to signals to increase equity exposure.