People feel great when their stocks and real estate go up in value.  When they start to go down they panic and sell.  This begets more selling.  It's been relatively easy to make money in markets as interest rates have come down to near zero.  So, right now people are highly leveraged particularily in the housing market.  It's like buying a $100,000 worth of a penny stock on margin.  Once it starts to fall, get ready for the margin call.  Many will have to sell out.  So yes, I would agree to avoid bank stocks as the carnage in real estate could hit any day and last a year or even two.  People are up to their eye balls in debt, when the correction comes, they will feel less wealthy and curtail spending thus affecting bank earnings.