Saturday, November 1, 2008

Not bigger but definitely badder

Above is a graph comparing the present market downturn compared to those in prior bear markets. What I make of this is that in % terms, we are comparable to prior crashes, but this time the descent has been really really fast! That's what happens when the crisis is first seen in asset prices rather than in the real economy. Bubbles that are intentionally blown bigger burst much faster.

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