* September 3, 1929: the Dow peaks at 381.17, after a somewhat shaky spring and a very bullish summer. * September-early October: stocks decline mildly, but no panic yet. * October 15: The leading US economist Irving Fisher famously proclaimed "The stock prices have reached what looks like a permanently high plateau". * October 24-29: Black Thursday, Monday, Tuesday: the largest crash in the history of US markets. * November 13: The Dow closes at 198.60 (-49%) from September top.
@AndyM, S&P tested high again... will this market crash happen soon ?haha
Mike_Geraci
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I have lots of dry powder ready. I hope for the sake of a fire sale that happens. But at the moment its hard to picture a correction of that magnitude. But maybe thats exactly why it might happen!
fatboy007
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as long as we hold 82.5% mark ,it is just a correction
Bill_Howell
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Nice reminder. Below I've provided a few TradingView references and two other sources that have plotted similarities with 1929, including (lead, lag) times involved. I expect that there are thousands of others references proving comparitive plots. Several MarketWatch comments pose the question - will the Fed new accommodation of inflation lead to Japan-like post-1989 moribund conditions?
TradingView postings :
26Mar2020 TexasWestCapital, Amjad Farooq 1929 versus 2020
15Apr2020 PassiCoin, S&P500 1929vs2020- short-mid-long term Forecast. Conclusion- We are fucked
Two other subscribed sources :
28Mar2020 Steve Puetz newsletter, Economic Depression - (1929,1987,2020) comparison of Dow Industrials versus (NASDAQ,railroads)
25Apr2020 Steve Puetz newsletter, The Greatest Depression - (1997,2020) comparison of (DJIA, NASDAQ) versus 1997 Hang Seng (Hong Kong) crash
05Jul2020 Steve Puetz newsletter, Quadruple Whammy - (1637 Tulips,South Sea Bubble,1869,1929,1980 Gold,1982,1984,1987,2000,2008,2018,mid 2020) (DJIA,S&P500,NASDAQ) full moon before solar eclipse preclude to crashes
27Aug2020 Harry Dent subscriber update, Dow 1929 scenario - Dow first crash with 5-month bounce
AndyM
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@Bill_Howell, thanks for the references! I myself do realize that the market does not repeat itself, so any comparison to the past is all in vain, but on the other hand I cannot be convinced that nothing will happen this fall: it's just a question of magnitude.
logica
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When you say spike in yields, wouldn't it be opposite? The fed is buying bonds, driving yields even lower, keeping interests rate low until consumers want to start borrowing again to grow the economy. Wouldn't stagflation or deflation cause asset prices to drop?
AndyM
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@logica, the Fed is buying corporate bonds, not its own debt. Treasuries are tradable instruments, just like stocks, and treasury yields are set by the market, not by the Fed (opposite to the illusion of managing yields the Fed is trying to create). I think treasury yields are going to go much higher this fall, and will drag stocks down.