Thursday, December 11, 2008

the stock market: just how unusual is 2008?

Speaking of investments....
You know your investment portfolio is in trouble when....

(cartoon found here)

Just how bad is the 2008 stock market?

(chart found here)

This is a graphic of the Standard and Poor's stock index's annual returns, placing every year since 1825 in a column of returns from -50% to +60%. As you can see, it is a rough bell curve, with 45 of those 185 years falling in the +0-10% column. There are only 4 years each in the 40-50% and 50-60% return columns, and, through 2007, there were only two years in the -31-40% and -41-50% columns. You can see where 2008 to date falls (source).

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