2018 was a wild ride on Wall Street, with volatility so violent it made daily swings of 500 or more points on the Dow seem almost “normal.”
We experienced several record-setting point swings on the Dow and came within a hair of entering a bear market, where securities fall 20% or more from recent highs.
But there’s a big difference between a bear market decline of 20% and a major market crash, like the one we had during the 2007-2009 financial crisis, which knocked the S&P 500 down by 57%.
And when the dot-com bubble burst in 2000, the S&P 500 plummeted by nearly 50%.
And since this time around we haven’t yet entered a bear market (by the most common definitions), that means we are (still) in the longest-running bull market in history.
In two months, this bull market will hit its tenth birthday – something that’s never happened before. [Read more…] “Take Our Survey and Tell Us Where You Think the Stock Market is Headed”
October was one of the most volatile months for the Dow since 1900. Back then, we were hopping on the first electric buses in New York City and enjoying a new kind of sandwich called a “hamburger” in New Haven. And, we were piling onto an early “Loop the Loop” roller coaster on Wall Street.
Fast forward to October 2018… and enter the Zero-G Inversion Coaster. The Dow fell by over 1,000 points in two days. The S&P 500 dipped in and out of correction multiple times. The Nasdaq plummeted 700 points mid-month, soared over 300 points the next week, and then tumbled back down over 500 points toward month-end. It comes as no surprise that the Fear Index also hit a 3-month high.
It wasn’t Halloween that spooked the markets last month…
Investors had plenty to fear with trade wars, tariffs, rate hikes, Fed policy, underwhelming earnings, slumping housing data, and political partisanship run wild. And as the sugar high of tax cuts, low interest rates and low inflation wears off, there’s a pervading sense that we’ve reached some sort of flashpoint.
What keeps economists up at night? One very sobering question:
What if This Economy is “as Good as It Gets”?
[Read more…] “October 2018 Was Among the Most Volatile Month for Stocks in 118 Years”