I was talking to someone today, and one thing I am realizing is that people do not understand the severity of the decline/correction we are going through. It is easy to look at the Dow chart I posted a dozen times over the past six months and say "well, we are back at 2002/2003 lows". True, but to put it in perspective:
1.) It took almost five years for price to move from the low-7,000 range to the high of 14,198 (October, 2007).
2.) Ten months ago we were above 13,000.
3.) Seven months ago we were above 11,000.
4.) Four months ago we were above 10,000.
When considering the low-7,000s referenced in #1, it is important to note that those levels were the result of a three year decline that occurred after price reached the previous high of 11,750 (January, 2000). So the last major decline/correction after a new high took three years. The bulk of this decline/correction has taken less than a year; less than a year to wipe out 100% of the gains that took almost five years to achieve.
So yes, we are back to 2002/2003 lows.
edit - I just heard on CNBC that if the markets averaged a 7% return per year, it would take until 2020 to get back to the old high. That puts things in perspective.
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