For those with short-term memory

For anyone thinking about getting long (with a time frame greater than a couple weeks) on the news of the latest bailout, please be reminded of the following interventions that also didn't lift this market for any significant period of time:

Fed Funds rate cut of 75 bps
Backstopped the financing that JP Morgan provided to Bear Stearns
Opening the Discount Window to non-bank broker dealers
Fannie / Freddie Bailouts
Extending an $85 billion loan to AIG in exchange for an 80% stake in the company.
Banning the short sale of 800 financial stocks: worked great for Pakistan(http://www.istockanalyst.com/images/articles/pak.bmp2008930648.jpg)
Proposed $700 billion plan to form a holding company to buy 'toxic mortgages'
...

Now, eventually a reversal will occur. And THE bottom will eventually occur. But the odds are NOT in your favor of getting the timing on this right (check out all the 'bottom callers' from 2001-2003 HERE). So, befriend the trend. Expect a short-term bounce on this government intervention just like all the other times and play it if you want.

But I think a better use of your time is finding some strength to sell into. Find some stocks that have a defined resistance level and look to buy puts - with stops - both for entry and exit - and use small position size. If the market is still too choppy for your taste (it is for mine) and you're concerned about getting stopped out early, then consider buying some deeper OTM puts with an extra month till expiration and be willing to lose 100% of the value of your puts (as long as this doesn't violate your risk management rules, i.e. 2% of capital). Base your OTM strikes on realistic price targets.