Stocks tumble; Dow drops below 7,000 (1st time since Oct. 1997)

[Pale Blue Dot]

Source: MSNBC

NEW YORK - Stocks tumbled at the open Monday and the Dow traded below 7,000 for the first time in almost 12 years after American International Group Inc. posted the largest quarterly loss in U.S. corporate history.

The government said it would give AIG another $30 billion in loans, in addition to the $150 billion it has already given the ailing insurer. AIG, which lost $61.7 billion in the fourth quarter, has been propped up four times now by the government.

Investors are worried about European financial companies, too. HSBC PLC, Europe's largest bank by market value, on Monday reported a 70 percent drop in 2008 net profit and said it needs to raise $17.7 billion and cut 6,100 jobs.

World stock markets dropped Monday, too, with benchmarks in Britain and Japan sinking 4 percent, as the worsening U.S. recession and more evidence of deep rot in the financial industry dashed hopes of a global recovery later this year.

Read more: http://www.msnbc.msn.com/id/3683270/

---

There is still no bottom in sight.

[Odin2005]

1. Fuck. I need some more Paxil.

This is horrifying. The last time I remember these Dow levels I was in 5th Grade I think.

[ret5hd]

2. Well, if you were in 5th grade in '97, you got plenty of time to recoup.

Us oldtimers are the ones gonna suffer! :)

[SahaleArm]

4. Yeah but old timers got to invest at really cheap prices

The S&P was 100 points 30 years ago, so investments have gone up 7x.

[ret5hd]

7. What was the avg price of a car 30 yrs ago? And now?

That 7x doesn't reflect the real world.

[SahaleArm]

10. The parent post was referring to investments.

Average car today is probably 4x-5x more expensive than back then.

[geckosfeet]

9. And the cost of living has gone up 10X - on net it's a big loss.

[SahaleArm]

13. Cost of living includes inflated home prices...

10 dollars thirty years ago is 33 today or a 3.3x decrease in value.

[Gormy Cuss]

20. Woo hoo! Tell that to someone who's 60 and has watched so much of the retirement fund disappear.

Fact of the matter is that mostAmericans did not have direct investments in stock or stock funds until 401Ks became common in smaller companies (ca. 20 years ago) and the investments were supposed to provide at least as good if not better retirement income than the defined benefit plans they replaced. For most near retirement age today it is very unlikely that will happen.

[Odin2005]

12. LOL, the reason I rember that was that we often used stocks to healp learn math!

[Bigmack]

3. Repub talking point of the day....

"Obama is responsible for the market crash!"

[whokilledthem]

5. We are so....

Fucked.

[No Elephants]

6. It may have gone below 7000 in 1997, but the drop was probably not as great then.

[Mrs. Overall]

14. No, it was heading up to 7000 in 1997, not going down.

[No Elephants]

24. That makes my point even more. The story makes it sound as though we are roughly in the

same shape we were in in 1997. Other stories say 25 years ago, or even 60. Fact is, "happy" days are here again.

[opihimoimoi]

8. +wasn't it on the way UP in 97 during Dogs Reign? DOW

[Dr.Phool]

11. Only one thing to say.

THANK GAWD IT PASSED!!!!!!

:banghead: :banghead: :banghead: :banghead: :banghead: :popcorn:

[AngryAmish]

15. I, for one, blame Bush.

[tclambert]

22. Your handle is AngryAmish, and you're on the internet?

OK, that's funny. Good one.

The other funny thing is there are Republicans who will blame the guy who has been in office for one month, while giving the last guy a pass on responsibility for the 9/11 attacks because he was only in office for 7 1/2 months, and they'll start throwing around the term "fiscal responsibility" after acting like no such concept existed for the last eight years.

[Dr.Phool]

16. Below 6900 now.

[CatholicEdHead]

25. Below 6800 at the end of the day

[Delphinus]

17. No, No, NO!

Why give them more fucking money???????????

[xchrom]

18. +5

[slipslidingaway]

19. Chart of the Day - Inflation Adjusted DOW chart since 1925

http://www.chartoftheday.com/20090227.htm?T

"For some long-term perspective, today's chart illustrates the Dow adjusted for inflation since 1925. There are several points of interest. For one, the inflation-adjusted Dow has gained a mere 55% since its 1929 peak and gained only 10% since its 1966 peak – not that impressive considering it took many decades to achieve those gains. It is also interesting to note that based on an inflation-adjusted Dow, the current bear market actually began in 1999 only to be interrupted briefly by a multi-trillion dollar credit bubble. That bubble has burst, of course, and the Dow now trades at a level not seen since 1995."

[RJ Connors]

21. I would like to point out that in 1929

If you were invested in the market and had a properly diversified portfolio, if you had of just stood pat after the crash your portfolio would have gotten back to it's original value in about 2 1/2 years.

A couple of the big problems with the crash of 29 was panic selling, and too much buying on margin by everyday folks who really didn't have the money to be playing that game.

[Zynx]

23. That was true in 1987. 1929 you were back in 6 months, then it took 24 years to get

back there. People forget about the modest recovery that happened then it fell apart. Our trajectory is actually more like the Asian Financial Crisis and the causes are similar.