Last year we celebrated with our favorite Christmas tunes so this year sees us workng down the list. With that, you could do worse than 2000 Miles and Emmy Rossum’s Carol of the Bells. Why do we like sad Christmas songs? Because blue is better than sugary-sweet; most holiday diddies give us the toothache. Like last year, one’s a little bittle carrolly, one’s a little bit rock ’n roll. Something for everyone.

Let’s ring-a-ding this year out and look forward, we hope, to a thaw in 2009, for which this much is certain: the scale of redemptions scheduled for December 31 represent the hardest “reset” that money-management has ever seen. Whatever the market brings us — even if it turns out to be more of exactly the same — fund flows have never seen a harder inversion of trend than that which announces the first quarter. Credit and new investment doesn’t have to get loose, but for the first time in a year, investors will have the option to make new committments — and in many cases, at deeper discounts to long-term growth — than many markets have ever seen. The first half should bring a sigh of relief, if nothing more; and markets can still, we think, look ahead six months to discount recoveries as well as recessions. Of course, if investors on average could look out further, all but the most aggressive would be better off, on average, over the course of even a single cycle.

Perhaps we will all become a little longer-term in our thinking, perhaps not. For all the wisdom imputed to them, markets and crowds have not acted wisely in well over a decade — or since roughly the time that hedge funds came to dominate money management. ♦