Dow charts: 1929, 1987, & 2008

[yurbud]

This gives some hope if the numbers are accurate. It's possible that the 1929 crash had a longer tail because there were no safeguards in place to keep things from going off the rails. Those safeguards were there in 1987, and how bad our current situation will end up being probably depends on how many and how big the holes are the GOP cut in the safety net.








Source:
http://www.physicsforums.com/blog.php?b=488

[PM Martin]

1. kick

[eleny]

2. the last chart looks like we're at a fork in the road

k&r

[sakabatou]

5. The Dems take the high road, the Reps take the low road...

[slackmaster]

9. We should take it!

[Renew Deal]

3. Interesting stuff

I wonder which way it's going to go.

[tridim]

4. The GOP sees these graphs and says, we like the 1929 trend line.

[serrano2008]

6. Looks good to me. Thanks for the graphs! Hey, does anyone know where I can find...

historical tables for all stocks? Not individual stocks?

I know I can go anywhere and look up what the price of GM was on any particular date, but is there anywhere where I can get the full table of all stocks on like 1/1/1987? and then 1/1/1988? and so on?

[starroute]

7. I was just trying to recall the 1930-31 stuff a little while ago

I learned about it in high school -- haven't thought about it since then. But I do know there was a major banking crisis just as things seemed to be recovering from the US stock market crash. Let me see what I can find.

Okay, there's something in Google Books at http://books.google.com/books?id=pq1tB3BDeuwC&pg=PA259&lpg=PA259&dq=1930+europe+banking+crisis&source=web&ots=ou4ftbxQC2&sig=_ABpvGFtMkvMoenqIZKzl3Yh2Uw&hl=en&ei=bAObSe3OIoGCtweKr5WpCw&sa=X&oi=book_result&resnum=1&ct=result and more at http://books.google.com/books?id=tXo6CAkhoroC&pg=PA134&lpg=PA134&dq=1930+europe+banking+crisis&source=web&ots=FJmd5X6zZ6&sig=UBCZEHPT-zumJWGLJEmfVazLL28&hl=en&ei=bAObSe3OIoGCtweKr5WpCw&sa=X&oi=book_result&resnum=4&ct=result#PPA136,M1

Basically, there were banking crises in Austria in May 1930 and in Germany in June -- when is exactly when that 1929 graph goes south -- and "an international crisis of financial confidence in early July." The Bank of England was slow to respond because they didn't think that what happened in Germany could affect them, and England was actually benefiting from capital flight from Central Europe. (The crisis was also regarded by British policy-makers as a convenient opportunity to suspend German reparation payments, which were seen as financially destabilizing.)

Commodities prices also kept falling throughout 1930 -- and that in turn led to a decline in long-term lending -- which produced a deflationary feedback loop, where producers had to sell more at ever-lower prices because they could no longer borrow. The causes of the decline in lending are debatable -- and may have been more psychological than anything else -- but that decline, combined with the banking crisis, turned a modest recovery in the first half of 1930 into a renewed collapse by that fall.

Runs on banks reached the US in November of 1930, and by 1931 there was yet another financial crisis under way. By then, the British government was attempting to respond by cutting spending, particularly social spending on behalf of the poor and working class. And from there on, things just kept getting worse.

[4 t 4]

8. These charts are very scary

looks like were headed down big time. These times are much more like the 30s the the 80s. Dow going to 5000 ot lower ?