Thursday, October 16, 2008
The market has been nothing short of violent this week. The Dow Jones Industrial Index has ridden wild gyrations of 20% - from a high of 9924 on Tuesday to today's low of 8197 - measured against the index opening on Monday. That range was 25% last week! The last time it had that kind of movement was the week of Black Monday in October of 1987. Prior to that the great moments of market volatility were in mid-July 1933 (after the Dow had rallied famously off its July 1932 bottom, recording a record 154% annual return, before stagnating for years with the consequences of the National Industrial Recovery Act of June 16, 1933) and the October 1929 crash. Indeed, this is another epic moment for the stock market, which is again teetering on the powerful whims of government intervention.