The GD Comparison

The current decline from peak of the Dow Jones Industrial Average directly corresponds to that of the Great Depression:

The 18-month trend:

381.17 (9/3/29) -- peak level reached
183.76 (3/3/31) -- 51.8% decline

14,164.53 (10/9/07) -- peak level reached
6,754.50 (4/9/09) -- projected, with the same 51.8% decline

We currently stand at 6626.94 (53.2% off peak), so we might actually end up with a worse drop (in percentage terms) than back then.

The ultimate bottom was reached on 07/08/32 when the market hit 41.22, a 89.2% drop 34 months (or 2 years, 10 months) after peak.

If we followed that trend today, we would reach a bottom of 1531.76 on or around August 14, 2010.

Let's hope that doesn't happen.

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The 2000-2002 decline also lasted around 34 months. The peak was reached on 1/14/00 at a level of 11,722.98 while the trough was 7,422.84 on 10/07/02, a 36.7% decline over 33 months.

DED Alert (March 6 Edition)

More Dire Economic Data:

This morning, the unemployment rate for February was announced at 8.1%, a significant increase from January and part of an alarming upward trend. More than 650,000 jobs were lost last month and that number -- like those of previous months -- will likely be revised upward. All told, we have lost 2.6 million jobs in the last six months and 4.4 million over the course of this 15-month (and counting) recession.

Could we see 10% by the end of the year? Or even by June?

Goodbye 1982, hello 1933.