The Dow Jones Industrial Average plummeted 300 points Monday, to 6,763, its lowest point since 1997, said Ben Steverman in BusinessWeek online. But investors already knew things were bad on Wall Street. What they want now is “a way to calculate when the losses will stop.” Technical analysts look for support levels—points where indexes will turn around—but “the floor fell out” of the markets in the past few days, and we’re now in “uncharted territory.”
Judging by the last four “massive stock bubbles”—in 1901, 1929, 1966, and 2000—we may still have a ways to fall, said Henry Blodgett in Clusterstock. Robert Schiller’s price-to-earning ratio chart shows the 2000 bubble as by far the biggest, and we could be only halfway through the deflating. You want “the silver lining”? The more stocks fall, the cheaper they are.
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