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Thursday, March 01, 2007

Was the Crash on Tuesday All That Bad? No.

If you read the general press and even the financial press, you would get the impression that the one day drop of over 416 points was terrible. However, if you compare it the the other big one day drops in modern Wall Street history, you will discover that the drop was not all that bad.

In terms of number of points, the drop was only the seventh worst. But if you look at percentage drops, the performance was even milder. Tuesday the 27th ended up in 10th place, which means that there were nine other days in the last 20 years that were far worse.

Here is the list of one-day-drop days, sorted by percentage drops with the worst one first. Point drop shown after the date, then percentage drop.
10/19/87 -507.99 -22.6%
10/27/97 -554.26 -7.18%
9/17/01 -684.81 -7.13%
8/31/98 -512.61 -6.37%
4/14/00 -617.78 -5.65%
7/19/02 -390.23 -4.6%
9/20/01 -382.92 -4.37%
3/12/01 -436.37 -4.1%
10/12/00 -379.21 -3.64%
2/27/07 -416.02 -3.3%

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