When did the market get so wild?
It’s been a riotous four months in this country, economically speaking, especially when one is talking about the wild mood swings in the stock market. In discussing the various factors that have sparked the stampede to the exits in what used to be America’s favorite casino, me and a pal harkened back to the good old day, when a big day for the Dow was a 12 point move. I thought I’d take advantage of my easy access to the Archives of Planet Earth, also known as the Internet, and retrieve the figures for a typical month 20 years ago to see if our musings were at all accurate or merely the sentimental claptrap of a couple of hairy-eared geezers. Turns out we weren’t off by much. Check ’em out; the daily moves made by the Dow Jones Industrial Average in October of 1988 (with numbers rounded off ).
Oct. 3 down 7, Oct. 4 down 3, Oct. 5 up 4, Oct. 6 up 1, Oct. 7 up 38 (Woo woo! break out the cigars!), Oct. 10 up 8, Oct. 11 down 2, Oct. 12 down 20 (Please, nobody panic), Oct. 13 up 7 (Nice rebound!), O-14 down point 18 (As in 18 one-hundredths of one point), O-17 up 7, O-18 up 19, O-20 up 44 (Up 70 points in three days. Party in Gekko’s office!), O-21 up 2, O-24 down 13 (suspected Gekko profit-taking), O-25 up 3, O-26 down 8, O-27 down 25, O-28 up 9, and on Halloween, down 1.
Obviously, these were calmer, pre-computerized times. Considering what’s taken place here in 2008, it’s no wonder there are many who can’t help but feel a bit nostalgic for them. Nostalgic for that feeling that, while the market might move into bear territory on occasion, you wouldn’t have to worry that your retirement savings would be disemboweled by 60 percent in a three-month span. Or a three-day span. Hell, a three-HOUR span! (And if you don’t remember Gekko, I’m referring to Gordon Gekko, the greed-gargling stockbroker played by Michael Douglas in the Oliver Stone flick Wall Street).
Compare those daily closing figures for 1988 to those of this past July. And if you’re sensitive to motion sickness, take your pills and buckle up. July 1 up 38, J-2 down 157, J-3 down 9 (A rare throwback to the good ole days), J-7 down 58, J-8 up 159, J-9 down 237, J-10 up 81, J-11 down 126, J-14 down 58, J-15 down 88, J-16 up 278, J-17 up 208 (wheeeee!!!!!), J-18 up 60, J-21 down 28, J-22 up 145, J-23 up 29, J-24 down 281, J-25 up 29, J-28 down 238, J-29 up 264, J-30 up 186, and finally, we can depart this stomach-tossing roller coaster with a July 31st downer of 199 points. (For all this hyper-volatility, there was a net gain of all of 38 points for the month, with a closing number of 11,378.02. Of course, that seems like ancient history now after September and October took a chainsaw to the poor ole Dow and hacked off another 4,000 points, taking it down to about 7,500. For many players in the casino, this is the time when economics truly became eekonomics).