Join 3,411 readers in helping fund MetaFilter (Hide)


Down, down, down.
December 9, 2008 6:28 PM   Subscribe

By one measure, this stock market is as bad as any in the last 180 years.
posted by CheeseDigestsAll (21 comments total) 5 users marked this as a favorite

 
That chart kind of looks like capitalism giving us all the finger.
posted by you just lost the game at 6:42 PM on December 9, 2008 [2 favorites]


Jesus, I'm graduating from college right now. I need to quit seeing shit like this.
posted by 235w103 at 6:55 PM on December 9, 2008


Jesus, I'm graduating from college right now. I need to quit seeing shit like this.

Actually, that's probably the best place you could be right now. Compare that to someone about to retire or someone with a young family.
posted by Octoparrot at 7:09 PM on December 9, 2008


Hey, so I was right...this place is becoming DailyKos.
posted by SeizeTheDay at 7:10 PM on December 9, 2008


The volatility between 1931 and 1933 finds those years on the polars; thumb and pinkie.
posted by ageispolis at 7:19 PM on December 9, 2008


I have a friend who's looking to buy her first house. She couldn't be in a better position (no debt, and not stocks for that matter, just a bank account).

Just sayin' -- there's always a bright side for somebody.
posted by bardic at 7:44 PM on December 9, 2008


Jesus, I'm graduating from college right now. I need to quit seeing shit like this.

OK, look at where 1931 is on the chart. Now find 1933. This too shall pass.

On preview: what ageispolis said.
posted by revgeorge at 7:50 PM on December 9, 2008


Octoparrot has it right:
Actually, that's probably the best place you could be right now. Compare that to someone about to retire or someone with a young family.

Repeated for clarity. If you aren't going to retire in the next 10 years, AND don't move your money around a lot, you are likely to recupe all of your so-called investment "losses" in this recession. Your 401k will rebound, your Roth will regain its value, etc.

Of course, 235w103's real problem is going to be finding a job. As soon as you do, though (and I have every confidence you will, although it might take longer than it would have a year ago), MAX OUT A ROTH!!!! 15.5%/year, starting immediately. The market has seldom ever been more full of deals. Find a low-overhead index fund, and sink all you can into it.

When you retire, fabulously well-off, spare a kind thought for elderly me, nursing my apple sauce in the retirement home, and buy me a Fanta, wouldya?
posted by IAmBroom at 8:01 PM on December 9, 2008 [2 favorites]


By one measure, this is the worst metafilter post in 180 years.
posted by klangklangston at 8:02 PM on December 9, 2008 [3 favorites]


2008 ain't over yet. We still have 22 days to push over into a whole new column!

ok, 21 days and eight minutes. Hurry up, folks. Throw money at Detroit, that'll do it.
posted by ook at 8:22 PM on December 9, 2008 [1 favorite]


Throw money at Detroit, that'll do it.

'm with ya Ook. So long as we can recupe all of our so-called investments!
posted by Nick Verstayne at 9:06 PM on December 9, 2008


That chart kind of looks like capitalism giving us all the finger.

The year is 2008, and we've all been smacked by the Invisible Hand.
posted by Afroblanco at 9:57 PM on December 9, 2008


I said here back in June 1050 by the EOY, and I still think we'll go out there.

The S&P driven down to 750 was, as the Japanese would say, 大-panic.

The Great Depression II is still in the cards perhaps, but as Terminator II taught us the future is what we make it.
posted by troy at 11:06 PM on December 9, 2008


I don't get it.

Well several things:

1) Why this terrible post is still here.
2) Why so many people seem to be getting off on the bad economy like it's some kind of disaster porn, to the point where they buy into Daily Kos drivel that uses phrases like "By one measure..." Even if you somehow torture reality into a shape where their one random-ass, handpicked "measure" proves something, why do otherwise intelligent people suddenly believe that the stock market is an accurate gauge of the economy's health? Was the high Dow in 1929or the late 90s indicative of an incredibly healthy economy?
posted by drjimmy11 at 11:47 PM on December 9, 2008 [2 favorites]


-50% for 2008? Looks like just what our brokers are saying. I hate to open their mail.
posted by Cranberry at 12:03 AM on December 10, 2008


The linked article is very superficial, and misses several very interesting observations about the equity markets at present.
  1. The extreme volatility in the US Equity markets; we simply haven't seen such extreme moves, day in and day out - and intraday no less! I've previously posted my opinion that we're seeing much of this driven by the Volatility Arbitrage guys, and it seems more folks are taking that view.
  2. Negative yields on the 3M T-Bill - historic enough the 10Y is squarely below 3% with 30Y challenging that threshold, now we're seeing folks so spooked they're willing to pay the US Treasury to hold their money (this is, of course, something we've seen in Switzerland in the past, but ... )
  3. Gold in backwardation - gold has flirted several times with backwardation (spot price of a commodity greater than the near term futures price), again something we haven't seen that much in the past.
So incredibly historic times, and the absolute level of the markets is a very, very superficial view of what's going on.

Those are just my top three curiosities; lots more going on, and I just wish I had more hours in the day.
posted by Mutant at 12:11 AM on December 10, 2008 [4 favorites]


why do otherwise intelligent people suddenly believe that the stock market is an accurate gauge of the economy's health? Was the high Dow in 1929or the late 90s indicative of an incredibly healthy economy?

the fuck?

Equities exist to provide capital to corporations in return for dividend returns and/or capital gains.

Many factors go into their pricing but the fundamentals are based on market wisdom discounting future corporate profits.

However, it's a common criticism of economics to deal in abstracts and not human failings, so the "wisdom of crowds" can and will often turn into the "madness of crowds".

Equities losing 50% means the market is pricing in a replay of the 1930s, or perhaps a replay of the Nikkei meltdown.

See that blue line? The S&P may have been following that same drawdown when Greenspan decided a "soft landing" was necessary in 2002-2004.

There's a lot of noise in the market, but in this noise fundamentals are visible if not clearly evident underneath the panic sell-offs and blowoff tops.

Anyhoo, I don't get why you are teeing off on Daily Kos. For one, this is an interesting article that I would not have found (I may have a sub-100 user ID on Kos but I stopped going there around when they changed the scope of the site).

Secondly, "by one measure" isn't even in this DKos post, and the FPP is using the measure of calendar year decline, which IMO is in fact "one measure" of the performance of the stock market.
posted by troy at 12:16 AM on December 10, 2008 [1 favorite]


Oh I forgot, Napier is calling for a further decline of 55% in the S&P to a bottom of 400 in 2014. Something to look forward to no doubt.

He's calling that trough based on Tobin's Q and the yield on the 10Y, and sees a short term equity market bounce as all the cash that's been injected into the system takes effect.

Ah! In other interesting news McDonalds is now more credit worthy than the Bank of England, judging by the premiums on Credit Default Swaps.

Like I said, not enough hours in the day
posted by Mutant at 12:27 AM on December 10, 2008 [1 favorite]


Here's a piece on Napier/Q, to follow up Mutant above...
posted by jckll at 7:56 AM on December 10, 2008 [1 favorite]


"'m with ya Ook. So long as we can recupe all of our so-called investments!"

Re-"coupe," surely.
posted by klangklangston at 9:38 AM on December 10, 2008 [1 favorite]


Don't count your chickens before they're re-cooped.
posted by ZenMasterThis at 10:41 AM on December 10, 2008


« Older Caga Tio: The World's Misunderstood Yule Log (NSFW...  |  Interior New York Subway, 14th... Newer »


This thread has been archived and is closed to new comments