Dow Jones Charts: 1921-1945
Comparing the current top (below, circled in red) with the 1929 top (above) clearly shows just how bad things can actually get. If we are to experience a prolonged meltdown, it appears the indexes have the potential to fall a lot farther than anyone is even imagining.
Update: I added the Nasdaq Composite chart at the very top as requested in the comments section.
From the top in 1929 to the bottom, the Dow Jones lost almost 90%. Were something similar to happen today, we would be seeing the Dow Jones print 1620.
Seeing a 50% drop from the October 2007 top seems more likely. I would not be surprised to see the Dow Jones print somewhere as low as 7,000-8,000.
I included this weekly look at the Depression Top for some comparison to the current top. Again, current charts look like they still have a ways to go.
http://www.ibankcoin.com/peanut_gallery/index.php/2008/09/23/portrait-of-a-crash/
I’m waiting for a week of this before I revisit this post but please note at the end of it I said:
Start working out plans to ride some huge volatility spikes. Think 3SD at least if not more. Options are probably a good tool but I don’t know diddly about options.
When moves start approaching 500 points, sell into the rally and sit on your cash. That’s just my humble opinion.
September 29th, 2008 at 9:22 pmA little something to cheer us up?
September 29th, 2008 at 9:22 pmAnd for some reason my total rating on that post was 4.56
Hmph.
September 29th, 2008 at 9:23 pmNow someone get Chivas up and ask him why he wanted to see these charts…
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September 29th, 2008 at 9:24 pmWoody,
thanks a million. one more thing please. use the comp for the bottom chart. 1995- present
Jake,
i will get to that.
September 29th, 2008 at 9:36 pmChivas, ok, gimme a sec.
September 29th, 2008 at 9:47 pmWoody,
thanks, very similar right? % up % down time to top and time to bottom.
September 29th, 2008 at 10:00 pmChivas, I guess so? I’m not sure where you are going with this.
September 29th, 2008 at 10:07 pm