Finance
Its Official: Stocks Worse than 73-74
This was quite a day in the financial markets. US Treasury bond yields hitting record lows and prices rising at a record pace. First time claims at a 16 year high. Another late day swoon in the equity markets. And swoon they have. It can now be said officially: The bear market of 2007-2008 is worse than that seen in 1973-1974. During that very unmemorable period, the S&P 500 index declined from a peak of 121.74 in January, 1973 to a low of 60.96 in late September, 1974 - a decline of 49.93% over 21 months. It then rose about 50% off the lows during the following 9 months and by early 1976 was trading only about 15% below its 1973 peak ... for the next 18 months. All told, the index traded over 4 years in a range of -25% to 0 compared to its peak before finally making a new high in July 1980. The chart below shows that period.
The bear market of 2007-2008 (lets hope it doesn't continue into 2009!) has now seen a drop of 51.9% in the S&P 500 index over a 13 month period - greater and faster than 73-74 and rivaled only by the 1929 crash (in the US). Graphically:
Finally, the view from 1965 thru late 2008:
As a bonus for those of you into BDSM, here is a view of the DJIA from 1928 until 1965. It took over 25 years to regain the 1929 high with over 15 years spent at under 50%.
