. October 16, 2007 SouthAmerica: I donât know why this thread discussing stock market crashes in the United States was moved from the economics forum to the Politics and Religion forum. I guess the moderator of the economics forum think that stock market crashes has no economic consequences for the United States because it is caused or by politics or by an act of God. Anyway we can talk about the possibility of a stock market crash on the Paul Krugman's thread 1928 and the stock market crash â you can find it at the politics and religion forum. The other possibility that this thread was moved to the Politics and Religion forum is because Wall Street is hoping for an act of God (Religion) to avoid the stock market crash. No wonder they are resorting to God to save them â with the sub-prime mess getting worse, the war in Iraq engulfing another country into the conflict â Turkey â and oil prices approaching $ 100 dollars per barrel. I guess it is getting to the point that only God can help. At the end of the day the truth is the stock market in the United States is way overdue for a major stock market crash like the one in 1929. .
. October 16, 2007 SouthAmerica: When we talk about major stock market crashes we are talking about the United States. We are talking about the crash of 1929 and also the mini-crash of 1987. You are right about one thing when the crash comes to the US stock market - that crash is going to affect everybody else including Bovespa in Brazil. When the shit hits the fan in the United States it will be a big stink around the world. Basically today the US stock market is ripe for another meltdown. One thing we know for sure - Americans prefer the month of October to stage these massive meltdowns. It could be the crash of 2007 or the crash of 2009. .
. October 16, 2007 SouthAmerica: Reply to Stock Trad3r The last time that I predicted that the stock market was going to crash, the market collapsed soon after. I wrote that the market was going to collapse in October of 1999. The Dow Jones started going down 2 months later, and the Nasdaq took a little longer. But the Nasdaq also went down starting in March of 2000. When I made my prediction in October of 1999, I received a lot of emails from people like you saying that I did not know what I was talking about. The rest is history. PS: The stock market crash is coming but the question is: It will be in October of 2007 or in October of 2009 or at any time in between? .
Your October 1999 market crash prediction was horrendous to say the least. The NASDAQ doubled between October 1999 and the March 2000 peak. At no point did the NASDAQ trade below the October 1999 lows until late December of 2000. Even the DOW short call was bad. From the October low to the January peak, you would have been 15%+ out of the money. In fact, at no point from the October lows until 9-11-01 would you have been more than a couple % in the money on your short call (almost 2 full years)....and the large majority of time you would have been well out of the money.
. October 17, 2007 SouthAmerica: Reply to Longhorns Here is what I wrote on September 27, 1999: On September 27, 1999, I wrote the following information: "The Dow Jones Index increased from 72 in 1920 to 360 in October 1929 when the stock market crashed. Then four years later the Dow Jones had declined to 60; a decline of 80 percent from its high point in October 1929. The Japanese market index increased from 4,350 in December 1975 to 38,916 in December 1989 when the Japanese bubble burst. Then by 1998 the Nikkei sunk as low as 13,000. From 1990 to 1998 the Japanese stock market declined by more than 70 percent. The Dow Jones index increased from 780 in 1982 to the current 11,000 level in September 1999. The Dow Jones has increased by 14 times in 17 years. Not Bad!!! But when we compare this increase with the 12 percent average increase per year for the Dow Jones over the long term, then we know that we are close to the exploding point of the bubble. During the summer of 1929, many fools thought the increase of the Dow would go up forever. We will have a reality check in the near future. If you want further evidence for the coming crash, just check the historical average market P/E ratios with the average market P/E ratios of the Japanese stock market before the crash in December 1989, and the current American market average P/E ratio. âMarket crashes give smart people the opportunity to find many bargains. It is just a matter of having cash on hand to pick up the bargains." ************ Here is what happened the following 3 years: Actual closing figures for the DJI: Date â DJI Close 27-Sep-99 = 10,303.39 29-Sep-00 = 10,650.92 28-Sep-01 = 8,847.56 30-Sep-02 = 7,591.93 Note: As I mentioned on September 27, 1999 - âMarket crashes give smart people the opportunity to find many bargains. It is just a matter of having cash on hand to pick up the bargains." *************** I did not mention the Nasdaq on my prediction on September 27, 1999 â But by January and February of 2000 I thought the traders on Wall Street had gone insane regarding what it was happening on the Nasdaq. Date â Nasdaq Close 27-Sep-99 = 2,761.75 29-Oct-99 = 2,966.43 30-Nov-99 = 3,336.16 31-Dec-99 = 4,069.31 31-Jan-00 = 3,940.35 29-Feb-00 = 4,696.69 10-Mar-00 = 5,048.62 31-Mar-00 = 4,572.83 28-Apr-00 = 3,860.66 31-May-00 = 3,400.91 30-Jun-00 = 3,966.11 31-Jul-00 = 3,766.99 31-Aug-00 = 4,206.35 29-Sep-00 = 3,672.82 31-Oct-00 = 3,369.63 30-Nov-00 = 2,597.93 29-Dec-00 = 2,470.52 31-Jan-01 = 2,772.73 28-Feb-01 = 2,151.83 30-Mar-01 = 1,840.26 30-Apr-01 = 2,116.24 31-May-01 = 2,110.49 29-Jun-01 = 2,160.54 31-Jul-01 = 2,027.13 31-Aug-01 = 1,805.43 28-Sep-01 = 1,498.80 .