What was expected to be a mild correction last week turned into the Thursday panic – not in Europe where there was a problem with Greece, but right here in the USA.

There was absolutely no macro-economic reason for the drop. There was no news to explain it. The TV networks were reduced to running days-old pictures of a Greek street demo as the stock tickers collapsed.

The S&P500 was down 8.6% – 8.6%! – to 1065 at the low (around 2.30 pm) on nothing, nothing at all. There was no news flow associated with this, just pure unadulterated panic. The Dow-Jones experienced the biggest intraday drop ever (in points), nearly 1000 points..

Now the exchanges and the SEC are investigating erroneous trades mainly to do with ETFs.

The lesson: never underestimate the degree to which fear can seize markets even when there is nothing tangible to be afraid of.

Greece is a mess but it is a tiny economy, marginal even to the Eurozone. The EU Governments, with delays, have finally produced a fat package and have the majorities they need to pass this Greek bailout package through the various parliaments. They have no choice. Greece cannot default; cannot leave the Euro; cannot resolve its crisis alone. It took awhile, but the message got through.

(Today foreign markets are up again because of this inevitable result, which I have been forecasting without much impact for weeks. There was no alternative so the deal was done, at a higher price than had it been done earlier.)

Britain has a hung parliament. So what? So does Canada which has one of the best performing economies out there.

Yup, there are problems in Thailand. Iraq, Afghanistan, Sudan, Nord Rhein Westfalia, California, Iran, North Korea. That is not news either.

Remember Tom Lehrer: “they’re rioting in Africa, there are strikes in Iran. What nature doesn’t do to us, will be done by our fellow man.”

Back to Thursday. US traders calmed down eventually (but only a little), to bring the S&P500 down a mere 3.2%. And the Dow Jones Indistrials off 3.4%. With a few caveats, because the data are incomplete, it looks like the S&P fell 6.39% for the weekwhile the blue chip Dow index lost 9.2%.

Every sector was smashed by at least 2% but financials, energy and consumer services were hit particularly hard.

The flight to safe-haven flows pushed up the Greenback and US treasuries were a key beneficiary.

Forex moves were brutal, with the euro and sterling off by two big figures. Ditto commodities – gold rose $35 (to $1208), crude fell another 3.8% ($76.9) although base metals were mixed (copper down -0.2%, zinc up 2.7% and nickel down 4.6%).

Should I even bother with the data? The whole thing is so bizarre.

The day ahead will be interesting. In think the fed will keep rates low till the end of the year after this latest mess.

Because I could not get closing prices for many shares in the model portfolio for Friday, I have not updated them for paid subscribers who get stock and bond prices, and closed-end and exchange traded prices and Net Asset Values in their weekly Model Portfolios on the web..

I use data from my brokerage accounts and they were not all accessible over the weekend. Moreover Barrons warned that “due to unusual volatility last week, some of the closing prices transmitted to us by the various exchanges might not be accurate.” And notices from the NYSE and Nasdaq indicated that some Thursday trades at ridiculous prices 60% below the prior one would be “busted” Many of the busted trades involved exchange traded funds.

Ones at 59% however were honored, which sounds like it will lead to many lawsuits. Barron’s also managed in its issue dated today to tell people to trade mini S&P 500 futures. It was the E-mini-me’s which spread the Thursday sell off. (The article by Andrew Bary was about the meltdown so this is amazing.)

Another lesson here for us. Do not think stop losses to protect on the downside of shares, closed-end, and exchange-traded index funds will help in a panic like Thursday’s.

Your sale will take place only in sequence and with no buyers on hand the price will be well below the stop you have placed. Since most smart investors were worried about the downside recently, few of us managed to pick up bargains at 59% off in the selloff with buy orders.

But your editor who does not spend her days starting at a screen managed to earn quick gains for the Covestor yield portfolio, mainly because I feel more comfortable about the share prices of high-payout shares, and because I can borrow in the Covestor account at Interactive Brokers by paying 1% to buy preferred shares yielding 7% in normal times and double digits at the Thursday acquisition cost.

I would like to gloat but I could not access the prices on IB over the weekend. Their system is always user-unfriendly (if cheap), and it was more so than usual in the debacle. To not favor my IB clients over the paid subscribers who manage their own accounts, of course I sent out alerts to paid subscirbers about my trading as it occurred. They would have earned many times the subscription fee from the four trades I managed to get in before the market recovered at around 3 p.m. Thursday when I stroped trading.

More for paid subscribers from Greece, Spain, Israel, Switzerland, France, Mexico, Britain, Australia, and South Korea follows with some views on US from Mississipi, Nevada. Pennsylvania, and West Virginia.