10 Worst US stock market crashes in the US | Forex Factory

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10 Worst US stock market crashes in the US

  • #1
  • First Post: Mar 10, 2009 8:27pm Mar 10, 2009 8:27pm
I have Mig MT4 as 1 of my demo brokers. They have been giving free daily Analysis (Gann & TD Mark fans heads up ) , Views, Comments about FX & the financial markets in general. Just this Monday, i got this on my Mig MT4 mailbox.
I urge you to check them out..


Here's the list from the "best" down to the WORST
#10 Dotcom Bust 2000 to 2002
#9 1916 - 1917 Stock Market Crash
#8 1939 to 1942 Stock Market Crash
#7 1973 - 1974 Stock Market Crash
#6 1901 - 1903 Stock Market Crash
#5 1919 - 1921 Stock Market Crash
#4 1929 Stock Market Crash
#3 1906 - 1907 Stock Market Crash
#2 1937 - 1938 Stock Market Crash
#1 1932 Stock Market Crash
These Crashes average 40-45% decline, except for #1 w/c dropped a whopping -86%

Question is, where does the present mortgage meltdown-led financial crisis fit in?
History repeats itself..... AGAIN


Here's the Link:
http://www.migfx.ch/research/WORST090309.pdf


just FYI:
Mig MT4 timezone is similar with Metaquotes, Alpari US, XTB, WHC; ODL, IBFX is 1hour ahead of it; Mig is 1 hour earlier than FXPro, ForexGen, LiteForex/SIG, KVB Kunlun/ForexStar, WSD
  • #2
  • Mar 10, 2009 8:34pm Mar 10, 2009 8:34pm
Nothing from the 1800s?
  • #3
  • Mar 10, 2009 8:49pm Mar 10, 2009 8:49pm
I've also thought about that. I'm not well-versed with stocks, but i think there were certain criteria (regulation, reform, diversity/# of stocks, or the likes) used in making this list. or probably 1800s was just too far out.

Maybe u & others learned can share your insights about 1800s, or any time period for that matter, that were not included in the list.
  • #4
  • Mar 10, 2009 9:51pm Mar 10, 2009 9:51pm
before 1929 their not as interesting.
there's a list of biggest 1 day declines that i think is pretty interesting.
either listed in percentage terms or points. i think percentage is more accurate because the large size of todays markets a multi hundred point loss isn't so dramatic as a loss of over say 10% or more.
Black Monday
Black Tuesday

The Biggest One-Day Declines in the Dow Jones Industrial Average


The largest percentage decline for a broad stock market index occurred on November 19, 1987. The Dow Jones Industrial average fell sharply by 508.32 points to close down 22.6% for the day.

Dow falls 777 points, biggest one-day drop ever

http://3.bp.blogspot.com/_H2DePAZe2g...0/declines.PNG
top-20-one-day-percent-decreases-in-dow
Before Forex I was tall, and clean shaven. Now I am an Ewok.
  • #5
  • Mar 10, 2009 10:12pm Mar 10, 2009 10:12pm
Quote
before 1929 their not as interesting.

I completely disagree.

Deadly Friday, aka "Black Friday" in 1869 is very telling.

Link:
http://en.wikipedia.org/wiki/Black_Friday_(1869)

It was caused by the gold standard. As our currency was tied to gold, any speculation in the underlying commodity had a direct impact on our entire nation's economy.

These guys were the George Soros of the late 1800s, and the result was an economic crisis due entirely to the monetary policy of the day, with a hint of corruption stemming all the way up to the Presidency (President Grant).

Very relevant to today's situation, and a cautionary tale to anyone that would advocate a gold standard, unrestrained commodity speculation or any irresponsible monetary policy.
  • #6
  • Mar 11, 2009 2:40am Mar 11, 2009 2:40am
Very Interesting.....

Thanks england33 & Rabid for commencing a healthy "mini" discussion related to this thread. Hopefully this will expand further, hopefully even beyond the current global mess we have on our tables..
  • #7
  • Mar 11, 2009 10:49pm Mar 11, 2009 10:49pm
Quoting Rabid
I completely disagree.

Deadly Friday, aka "Black Friday" in 1869 is very telling.

Link:
http://en.wikipedia.org/wiki/Black_Friday_(1869)
Nope. Conventionally the modern market computation begins with the creation of the DJIA in 1896. This is the second oldest Index of the US made of couple of firms... (GE was in there)

If you're passionate about crashes happened early I suggest you to googling "tulipmania". You'll find that in early 1600 something pretty similar happened in holland with tulipans trade. Please do a search for Feb 9th and Thomposon Index. the hypotetical crash in that day was 4 time worst the Black monday collapse..


I hope it might help.
  • #8
  • Mar 11, 2009 10:54pm Mar 11, 2009 10:54pm
Quote
Conventionally the modern market computation begins with the creation of the DJIA in 1896. This is the second oldest Index of the US made of couple of firms... (GE was in there)

If you're confining yourself to "modern market computation" and the DJIA. But US stock market crashes go back further than that.

It's pretty funny tho to think of a tulip bubble in the 1630s.
  • #9
  • Mar 12, 2009 12:24am Mar 12, 2009 12:24am
Quoting Rabid
It's pretty funny tho to think of a tulip bubble in the 1630s.
You have to... trust me it will help to understand little more about our ages...
  • #10
  • Mar 12, 2009 1:03am Mar 12, 2009 1:03am
Quote
You have to... trust me it will help to understand little more about our ages...

Ie: People go bats**t crowd crazy over the dumbest little things?
  • #11
  • Mar 12, 2009 4:04am Mar 12, 2009 4:04am
Quoting Rabid
Ie: People go bats**t crowd crazy over the dumbest little things?
And they always will. It goes to the very heart of human nature, hence we will always see asset bubbles, as unlikely as that may seem during these trying times.
  • #12
  • Mar 12, 2009 4:37am Mar 12, 2009 4:37am
Quote
Nope. Conventionally the modern market computation begins with the creation of the DJIA in 1896. This is the second oldest Index of the US made of couple of firms... (GE was in there)

Yosefx,
I was thinking of something like this as possibly 1 of the criteria used in the above list... Glad u mentioned it.
but indeed, crashes go all the way back, even before 1900's as Rabid & u mentioned.



Quote
And they always will. It goes to the very heart of human nature, hence we will always see asset bubbles, as unlikely as that may seem during these trying times.

gammase1,
indeed. so when's the next one? probably 10-20 yrs from now when most people would have erased from their "mental hard drives" the 2000's mortgage-meltdown
  • #13
  • Mar 12, 2009 4:54am Mar 12, 2009 4:54am
Quoting supremeChaos
gammase1,
indeed. so when's the next one? probably 10-20 yrs from now when most people would have erased from their "mental hard drives" the 2000's mortgage-meltdown
Yes, somewhere between 10-20 years, definitely. By which time the severity of the pain inflicated from this latest episode will, to a large extent, be erased from our hard drives.

Then we'll have a bright, new crop of bankers and fianancial engineers, together with a whole new "financial paradigm" . And we'll all be telling each other: "this time it's different" and; "the global economy now has a robust enough framework to withstand the greatest of shocks, unlike in 2009".
  • #14
  • Mar 12, 2009 5:06am Mar 12, 2009 5:06am
Laff, don't forget decoupling. By then everything will be decoupled, right?
  • #15
  • Mar 12, 2009 5:10am Mar 12, 2009 5:10am
Quoting Rabid
Laff, don't forget decoupling. By then everything will be decoupled, right?
Yes!! I can even picture a very old Cramer screaming this at us in 2024..
  • #16
  • Mar 12, 2009 10:32am Mar 12, 2009 10:32am
It could be a brave, grim world by then..... with these "improvements":

a downside paradigm..... paradigm shift for the worst.

Cramer may be replaced by someone younger, just so to go with the times...
A robo-Cramer may not be far-fetched..

decoupling recoupling with a dose of depression stagInDeflation

gazitribillion is the new billion by then, & we could be talking about Madoff-like trilllion $ scams; gazitribillionaires in the Forbes List, , with some of them losing trillions, even gazitribillions, & even a few of them taking their life because of these losses.
  • #17
  • Mar 12, 2009 1:55pm Mar 12, 2009 1:55pm
My reasoning is the size of the markets were so small prior to the roaring 20's compared to todays markets and it doesn't do any good to study early markets unless your a history buff. In fact you can say those times brought about the computer age and need for data bases and complex computing. You would really have to break down charts to do any real charting on those early markets and the lack of modern liquidity.
Before Forex I was tall, and clean shaven. Now I am an Ewok.
  • #18
  • Mar 16, 2009 10:21am Mar 16, 2009 10:21am
checkmate! got what u meant, england33
  • #19
  • Edited 6:17pm Mar 16, 2009 6:02pm | Edited 6:17pm
Quoting Rabid
I completely disagree.

Deadly Friday, aka "Black Friday" in 1869 is very telling.

Link:
http://en.wikipedia.org/wiki/Black_Friday_(1869)

It was caused by the gold standard. As our currency was tied to gold, any speculation in the underlying commodity had a direct impact on our entire nation's economy.
3rd Sentence from the article.
During the American Civil War, the United States government issued a large amount of money that was backed by nothing but credit.

I not familiar with the details from this era, but the wikipedia article sounds like, the manipulation would not have happened if 'credit' was not issued in the first place. The speculation that the greenbacks that were printed and never backed by gold would be all of sudden be backed by gold would appear to be the issue.
Don't wish it were easier, wish you were better. ~ Jim Rohn
  • #20
  • Mar 16, 2009 6:27pm Mar 16, 2009 6:27pm
Quote
Doesn't sound like a gold standard to me.
You're right, there have been times where we left the gold standard because it wasn't flexible enough to allow debt.

However after the civil war it was expected that the US would again support it's currency with gold by allowing dollar redemption. That would've returned us to the gold standard. Thus speculation in gold had a direct impact on interest rates and the monetary supply. This set off a chain of events.

The history channel had an excellent special on this a while back... I wish I could find it again.
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