I think the tapering issue is over-cooked and over-feared by the market.
Just because of reducing QE (reduce, not totally stop, this is tapering means), and not yet about saying raising interest rate (Did Ben raise rate before?), now everyone talk about rising rate...
Reducing QE may cause bonds price back to the level they should have, it won't cause bond yield rising to the roof.
It just back to its normal day, that it should be.
While even QE is stopped eventually, it doesn't mean Fed must raise rate either.
But in stock market, and many talks just talk it likes end of the day of the stock market.
Even stock market drop 10-20%, it just means a healthy correction after several years of good day/year of stock market.
Having said so, even with volatility in the stock market recently, DJ is still steady above 15k, KLCI hardly drop, STI just drop a bit, so does major European bourses, so where is the actual "crash" of stock market?
None, but the tapering word keep on cooked again and again.
The target of the cooking is to realize that healthy correction of 10-20% for index stocks, and possibly 20-30% for small caps, which we still unable to meet. Market is just too bullish for any healthy correction to step in. As for traders, this 20-30% drop is the fear because many are not willing to hold long term, and many who follow TA are riding the up wave therefore their buying price could be quite high.