Wall St. faces record losses in last week of 2008

[kpete]

Source: Associated Press

Wall St. faces record losses in last week of 2008

By JOE BEL BRUNO – 3 hours ago

NEW YORK (AP) — Investors are preparing to close out the last three trading days of 2008 with Wall Street's worst performance since Herbert Hoover was president.

The ongoing recession and global economic shock pummeled stocks this year, with the Dow Jones industrial average slumping 36.2 percent. That's the biggest drop since 1931 when the Great Depression sent stocks reeling 40.6 percent.

The Standard & Poor's 500 index is set to record the biggest drop since its creation in 1957. The index of America's biggest companies is down 40.9 percent for the year.

With these statistics ready to play out this week, it is little wonder why investors are all too happy to close the books on 2008. Analysts are already looking toward January as a crucial period for the market as it tries to recover some of the $7.3 trillion wiped from the Dow Jones Wilshire 5000 index, the broadest measure of U.S. stocks.

Read more: http://www.google.com/hostednews/ap/article/ALeqM5ju0KuPIVUcs8asZpLJJ7XIeeMNzAD95C1B0O0

[Xipe Totec]

1. In the high stakes poker game that is Wall Street,

get ready for the Royal Flush.

:hurts:

[Jackpine Radical]

2. C'mon, guys. Only 4.5 percent and you'll have the new record.

You can do it. Dump, sell! Ditch those turkeys for this ears capital losses on our taxes.

This is all said with the sick fascination of watching an oncoming train wreck I am powerless to stop. For every greedhead who is about to be taken down, thousands of ordinary people are about to lose their savings and pensions.

[galileoreloaded]

4. Tens of thousand more likely. Wait until the .gov starts mandatory IRA and 401K rollovers into

Treasury accounts. They have to fund the 3-4 billion dollar a day shortfall somehow. You thought Madoff ran a Ponzi scheme?? Just wait.

[TahitiNut]

3. The supply of Greater Fools has become almost endless.

:shrug: ... and impoverished.

[olddad56]

5. I'm down 45% for 2008 and I'm going to cash out and take the loss,..

gambling that it will get much worse. So much more downside than upside.

[Lucky Luciano]

6. sounds like a good buy signal to me. nt

[Duppers]

12. you don't have 5 yrs to hang on?

if I cash out now, I'm losing 6 digits! I cannot stomach that, so I'm going to wait out the
YEARS it going to take to recover.

[AnnieBW]

7. People dumping their losers before 2008 ends

So they can take the capital loss off on their taxes.

That reminds me... gotta log into Sharebuilder...

[Lasher]

8. Similar article:

2008 could nail its spot as worst year

NEW YORK (Reuters) - As the U.S. stock market heads into the last week of the year, what was inconceivable just 12 months ago is now a stark possibility: 2008 could be the worst year ever for Wall Street.

The U.S. market's most tracked benchmark, the S&P 500, is down 40.6 percent since last year's close with only three trading days left in 2008. Given the market's hair-trigger volatility this year, that is just one bad day away from surpassing 1931's drop of 47.1 percent -- the biggest yearly decline ever.

As it is, the market's swoon this year will cement 2008's place in history by at least one measure: eviscerated wealth. A record $7.3 trillion of stock market value has been obliterated this year, according to the Dow Jones Wilshire 5000 index, the broadest measure of U.S. equity performance.

http://www.reuters.com/article/hotStocksNews/idUSTRE4BP3J820081228

Have the tax cuts paid for themselves yet?

[stubtoe]

13. The last year of the Bush administration will forever be associated with this.

n/t

[Lasher]

14. That is true but the first 7 were incredibly bad too.

Here is a spreadsheet of annualized S&P 500 performance, based on closing prices at the end of each year's last trading day:



I did not adjust for inflation. Prices reflect capital gains only and not dividends. I extrapolated midyear 2008 performance to project an S&P 500 result for this year of 1,092 but as it turned out that was wildly optimistic. Even at that the average annualized Bush 43 result would have been an astonishingly terrible -0.82%.

Now compare that to S&P performance under all other presidents, Carter to Clinton. The annualized average of all those years was a gain of 11.86%. It is only due to the catastrophe of the Bush 43 years that I feel a need to point out that this is an average gain and not a loss.

Remember how Saint Ronnie blamed Carter for everything that went wrong, almost to the end of 1988? And have you noticed that even to this day Republicans are using Carter as their perpetual scapegoat, trying to blame the current meltdown on him for having signed the Community Reinvestment Act of 1977? But these past 8 years have left Carter looking pretty good. Just compare the numbers on the spreadsheet. As a matter of fact The Worst President of All Time has made all other presidents look pretty good by comparison.

Soon I will be updating the spreadsheet to reflect the actual 2008 EOY performance. Let's say it will be 869, which was the closing price yesterday. That would make the 2008 gain -599 for a percentage gain of -40.82%. Bush 43's 8 year annualized average would then be -2.71%.

[stubtoe]

17. Lasher, when you do update your info, PLEASE make an OP of it.

'Cause we won't see it put together in the MSM anywhere, that's for sure :)

Great work, as always.

[Lasher]

20. Why thank you, stubtoe.

I had planned an OP on this as you suggest. I do believe New Years Eve is a trading day so I'll be doing that after the market closes tomorrow.

I think we'll soon see a lot of similar reflection on the GWB disaster. I don't know if you saw it posted here at DU but Harper's has got just such a thing in their January issue. Here's a link to it: http://www.unlawflcombatnt.proboards84.com/index.cgi?action=display&board=general&thread=4351&page=1#13895

Have safe fun celebrating the new year!

[jus_the_facts]

9. "Woo hoo hoo...go on take the money and run....."

:nopity:

[CoffeeCat]

10. It's going to sink even further...

...in my opinion, but what do I know?

All I see is further erosion of the retail sector--with thousands of retailers disappearing. That's why
I begged my husband to get our 401k funds out of the stock market and into a MM. Thank God we got out.
It's one thing to have a "dip", but I'm seeing a crash with many companies not surviving. That means
major, unrecoverable stock-market losses.

We lost about 20 percent, and it's sad to say that I'm grateful for that! However, the DOW and S&P numbers
we see today will look like gold---in a few months (or sooner).

I swear I'm not a cynic...I just see no way around this with another housing bubble set to pop and a
credit card bubble about to explode. Not to mention higher unemployment and a retail-sector meltdown.

[Duppers]

11. yes! we'll see the DOW into the low 5,000

by next Sept.

[Common Sense Party]

15. I highly doubt that.

[RUMMYisFROSTED]

16. Still too high?

[depakid]

18. Unlikely unless there's another oil shock

Too many good companies are oversold. They'll begin to rise again once the market starts trading on fundamentals.

[Common Sense Party]

19. Yup. I agree.

While we may see SOME bankruptcies, especially in the small- to mid-cap range, I don't think too many S&P 500-sized companies are going under, not unless things get REALLY bad.