"The "buy the dip" financial news teleprompter readers and the 30-year-old portfolio managers who have never seen a market crash are always insisting that stocks are going to the moon. Market veterans and "Hey Boomer" professionals have seen this show before. In 1987, the Dow Jones Industrial Average plunged a stunning 22% in one day. Today, a comparable drop in the venerable index would be 10,400 points."
"From 2007 to 2009, during the height of the mortgage and real estate collapse, which brought us dangerously close to another depression, the market dropped 57%. Stocks finally bottomed at an ominous intraday low of 666 on the S&P 500 on March 9, 2009. That set the floor for the longest bull market in history, which ended in January 2022."
"One positive is that consumers and businesses are generally in reasonably good financial shape. Stock portfolios and home prices have increased dramatically over the past few years. And the economic system is not teetering on the abyss as it was globally in 2008 when Bear Stearns and Lehman Brothers collapsed. To avoid a similar fate, Merrill Lynch became part of Bank of America."
Historic market crashes have produced sudden, severe losses: the Dow fell 22% in one day in 1987, the market plunged 83% from 1929–1932, and the 2007–2009 collapse saw a 57% drop. Stocks bottomed at an intraday S&P 500 low of 666 on March 9, 2009, before the longest bull market that ended in January 2022. Major indices currently trade at all-time highs. Consumers and businesses are generally in reasonably good financial shape, and portfolios and home prices have risen. Rising inflation, escalating wars, a national debt approaching $38 trillion, and AI hype could push markets materially lower.
Read at 24/7 Wall St.
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