Bears Plague Smoky Mountains-- Is Wall Street Next?

Professor Glenn Reynolds, who lives in East Tennessee, observes that hikers in the Smoky Mountains are being bothered by "Bears Gone Wild" (and not the kind Sully* hangs out with in Providence).

Another bear menace may be looming in the stock market. This morning's market update at NTCNews.com notes that concerns about rising oil prices and a bad Treasury auction helped cause a mild downturn on Wall Street yesterday. Jehuda the Rhetorican noticed this item from the Financial Times:

Concerns about the growth of government borrowing forced the US Treasury to give investors in an auction of $19 [billion] in 10-year notes a yield of 3.99 per cent -- 4 basis points higher than the yield available before the auction.

Given my woeful record as a prognosticator -- hey, I suck -- I'm hesitant to predict whether the market will go up or down on any given day. Nevertheless, the past few days have seen steady signals of inflation and higher interest rates.

Even if yesterday's 24-point Dow decline was just episodic profit-taking, the forward-looking nature of financial markets suggests that if investors are convinced credit costs will rise while the dollar declines, we're due for a big sell-off sometime soon.

*BTW, speaking of Sully, congratulations to Debbie Schlussel on her Malkin Award nomination. About three years ago, Debbie had dinner in D.C. with my wife and I. Debbie's quite the personality, and I'd advise staying off her enemy's list.

UPDATE: Also via Instapundit, more bear warnings from Megan McArdle:

How is a $118 billion structural deficit, $35 billion in Medicare Part D, and a theoretical end to the Iraq presence forcing Barack Obama to spend nearly $1 trillion in 2018? How is it forcing him to spend roughly $650 trillion more than he takes in in 2012?
This is not Bush’s fault. And you know what? Even if it were Bush’s fault, who cares?

Sitting around playing politics is all fine and good, but eventually political belief confronts economic reality and it's hello, Weimar America.