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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: smolejv@gmx.net who wrote (6449)	7/31/2001 12:07:43 PM
From: Ilaine	Read Replies (2) \| Respond to of 74559

As Grace pointed out last night (whoops, I see you guys have been talking about it but I am not going to change this post), there really hasn't been a Great Crash in the broad US market that's similar in magnitude to the Great Crash of 1929. People here on SI focus on the Nasdaq. I can't even find a symbol on SI for charting the NYSE, so I am using the Russell 2000 and the Dow to try to prove the point: Comparison over the past 100 months: siliconinvestor.com Comparison over the past 100 weeks: siliconinvestor.com People who live and work in Silicon Valley are going to have a completely different take on life than people in other parts of the world, unless they struggle for, and achieve, objectivity, and most don't bother. So you have to filter posts from people who live out there. I would expect that in Germany, people would be more pessimistic than in the US, because you already have high unemployment, had it all through the boom. What is it, roughly 8%? Why so high? If you want a list of ways 2001 is different from 1929, I'll give you a head start: 1) Europe and the US were on the gold standard then, after going off during WWI, printing a lot of money to pay for the war, experiencing roughly 400% price inflation and then a sharp spike down in prices causing a mini-depression in the mid-20's, and deflationary monetary policies which kept prices at least flat or forced them downwards, depending on the commodity. 2) Europe and the US hadn't fully recovered from the economic dislocations of WWI, not just the gold standard but the hyperinflation in Germany, the end of three empires (Ottoman, Austro-Hungarian, and Russian), the establishment of the Soviet Union, the spread of socialism, German reparations, English and French debts owed to the US, the destruction of large parts of France and Belgium, etc., etc., etc. I think you need to look at 1919-1939 as a continuum. The old world ended in 1914, and a new world was born, but the new world had a hard and bloody birth. 3) The US was experiencing severe drought in the Great Plains and deep South, both of which areas had an agrarian economy. 4) The US was a creditor nation then, not a debtor, so when other countries defaulted, the US got hurt. Countries which defaulted got out of the depression faster than ones that didn't. I haven't really studied the facts about the credit bubble, so maybe the Austrians are right, I can't say. I think I am going to have to make a website to keep track of all this, so I have reserved wheredidthemoneygo.com.-g-