Here is a mind blowing stat:  Stocks have lost $11 trillion in market value since the October 2007 peak, according to Marketwatch.

This is based on the Dow Jones Wilshire 5000 index, which includes nearly every U.S.-listed stock. Losses since the start of 2009 are $2.6 trillion. Nearly half of all stocks in the index are now trading at less than $5, and 37% are under $3.

Nearly 50% of all stocks in the Wilshire 5000, the broadest index of U.S. equities, are trading for less than $5 per share, and 37% are under $3.

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Wilshire 5000 October 2007 to March 2009

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Sources:
US Stocks Slip As Early Rally Evaporates
Peter A. McKay
March 6, 2009

http://tinyurl.com/11trillion

U.S. Stocks Gain as Oil Helps Dow Jump 150 Points
Cristina Alesci and Rita Nazareth
Bloomberg, March 6 2009

http://www.bloomberg.com/apps/news?pid=20601087&sid=aOMoW1aQ6dsk&

Category: Markets

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

32 Responses to “US Bear Market Losses: $11 Trillion Dollars”

  1. Dow says:

    October 2008 – stocks just collectively jumped out a window. Fun stuff.

  2. Neal says:

    How much is left?

  3. E says:

    Someone, somewhere needs to apply this same analysis to every equity market in the world, and combine it with a similar analysis of every housing market in the world. It would be enlightening to see an analytical estimate of worldwide wealth destruction since 07.

  4. Marcus Aurelius says:

    Neal Says:
    March 9th, 2009 at 8:42 am

    How much is left?
    ______

    Being that a dollar is defined as debt backed by “the full faith and credit” of the US government – not much.

  5. Jdamon33 says:

    With incomes pretty much stagnant for 10+ years, where in the world can the avg. person save for retirement? Simmons, Sealy and Posturepedic aren’t returning much these days….

    This is the single biggest issue our country will face in the next 5 years. Where is all our wealth going?

    I want to see who the writers of the AIG CDS’s actually were to see who is receiving all our taxpayer dollars. I will bet you there are a lot of hostile foreign players involved in this and the US taxpayer would be outraged to think we bailed out multi-billion dollar sovereign wealth funds.

    BTW, to those who say we don’t manufacture anything anymore, the US is #1 in value of items manufactured, so you can’t keep harping on that fact forever.

    Problem is, we have 30% of the people in this country supporting the other 70%. I have worked every day for 20 years and when I take a day off, there are so many people not working it just amazes me.

  6. rootless_cosmopolitan says:

    11 trillion US-dollars of fictitious wealth have evaporated in the stock market alone in the credit bubble economy that is bursting now. Add all the destruction of book value in other asset classes. I call this reality check. This is just the beginning, isn’t it? More to follow.

    rc

  7. TPC says:

    Even more astounding: $36 TRILLION in global equity – http://www.pragcap.com/global-equity-lost-36-trillion

  8. Kyle says:

    More NYT drivel regarding CNBC

    “CNBC Thrives as Hosts Deliver News With Attitude ”
    http://www.nytimes.com/2009/03/09/business/media/09cnbc.html

    RAH RAH GO YEAH GO CRAMER GO.

    Looks like the NYT tried to jump on but will end up getting run over by the Daily Show bandwagon.

    Really starting to think them going bankrupt is a good thing….

  9. JohnnyVee says:

    Are these prices bottom-ish or tops. In other words, “to what state of affairs do we expect to recover”.

  10. KidDynamite says:

    and this is EXACTLY the problem – PAPER wealth! that’s the only wealth we had… that’s why we are f’d going forward. all the wealth we thought we had was a big pile of paper profits – and we need to stop trying to get back to that absurd high water mark in our minds.

  11. mark mchugh says:

    Sorry to post off-topic, but is anyone else experiencing a live quote freeze?

    11:00 to 11:06 so far…..

  12. DeDude says:

    I think what is lost is the illusion of wealth and economic growth. The chart on TPC’s link shows the world is back to about May 2004. My guess is that we also are back to early 2004 if you looked at total real estate values. So we had this intense run up in pretend wealth and now all that pretend wealth is gone. There has been no real growth in consumer class incomes and, therefore, no real economic (or wealth) growth since the late 90’ies. It was all a fake so some very rich people could harvest absurd amounts of money while they pretended that trickle down actually works. The people in big trouble are those consumers who spend the pretend wealth and now have to back it with real income and work.

  13. Andy Tabbo says:

    “Just a flesh wound…”

  14. Marcus Aurelius says:

    Jdamon33 Says:
    March 9th, 2009 at 9:08 am

    “…BTW, to those who say we don’t manufacture anything anymore, the US is #1 in value of items manufactured, so you can’t keep harping on that fact forever.”
    _______

    We also count flipping burgers as part of our “manufacturing” base.

  15. Kyle says:

    “BTW, to those who say we don’t manufacture anything anymore, the US is #1 in value of items manufactured, so you can’t keep harping on that fact forever.”

    What percent of that is Boeing I wonder? And what percent of an airplane’s parts are made in the USA? The engines are mostly Rolls Royce, right? Same goes for cars, just because a car you assemble here is worth $30k doesn’t mean all or even most of that value is coming from american companies.

  16. GRV305 says:

    using the Dow as a marker (I know, but it’s a common guide),

    $11,000, 000, 000,000 / (14,000 – 6,600) = $1.5B per Dow point

    for the $36T, $4.9B per Dow point

    ouch!

    @DeDude: bulls-eye

  17. usphoenix says:

    @kyle: correct. Boeing continues to try to break their unions and ship more and more manufacturing off-shore via component contractors. The have a special airplane for flying fuselage units in from Asia.
    People have been writing about people leaving the job market for decades. It’s not exactly by choice. Automation, the internet and computers have devalued human capital enormously. Sure those with jobs get amazingly cheap products and services, and the rest get to deal.

    And yes, the only thing that juiced the market the last twenty years was real estate. Reality is here now.

    The cycle will be complete when Congress gives robots the right to vote, and everyone below CEO is deemed a terrorist in need of rehab.

  18. usphoenix says:

    Ooops. Almost forgot. Want enter the new booming job growth industries: Lawn service and changing senior diapers.

  19. zot23 says:

    The last and worst bubble is the attitude bubble we’ve had in the USA. It was formed of 1 part world reserve currency, 2 parts massive military budget, and 1 part unregulated greed (by all citizens, not just banks.) Blow the whole thing up with cheap oil and you have a huge bubble ready to plummet.

    This bubble hasn’t quite popped but it’s on the tip of a sharp rock. You’ll know it is gone when your stomach drops out (like a rollercoaster dive) and Americans realize we are as screwed as everyone else. We are on the edge now, closer than you might realize. There is a shrinking window for Obama and Congress to start taking the medicine and slashing off those parts of the country that are no longer functional or agreeable to change. If they don’t do this voluntarily, I don’t see any way we can avoid violence, riots, angry mobs, etc. Think that will improve confidence in the US market?

  20. retrogrouch says:

    Compare that to 2008 US GDP – $14.58 trillion.

  21. Mike in Nola says:

    Jdamon33: we are clearly #1 in manufacturing. Why, we’ve manufactured more than a trillion dollars in the past year.

  22. bartnet says:

    Hi,

    i have a question: Where i can find a chart comparing DJ vs US GDP especially in 1928-1938 period?

    thanx in adavnce!

  23. Pat G. says:

    Numbers like $11T or $36T are just astonishing!

  24. Avl Dao says:

    “…BTW, to those who say we don’t manufacture anything anymore, the US is #1 in value of items manufactured, so you can’t keep harping on that fact forever.”
    _______

    The online founts of ‘dial-a-fact’ include global production of military capital (ships, subs, jets) in that ranking as well, regardless of location of production, as other readers have noted.
    But wait there’s more! When citing the “value” of items produced; they base it on price paid, so of course Boeing etc skew the numbers. But imagine how much the military sales – and its $200 per rivet pricing – skews the ‘data’ upward? Tack on a couple of communication satellites and the likes, dollars for NASA ships, and you really get skewed data.
    Then there’s the fact that the recent American bubbles skewed data, esp. related to production goods for Iraq-Afghan armaments, but also airplanes, etc.

    If transparent fully-annotated data sources were used, you’d see the true picture of America’s hollowed out manufacturing in comparison to the consumer and business items it imports.

  25. GRV305 says:

    The numbers are not so scary if we use different units, almost stompable
    $0.011Q, $0.036Q

  26. EAR says:

    TPC…

    Can you provide a link to tips on how to clean vomit from the spaces between keyboard keys?
    It’s the least you could do…

  27. TPC says:

    @ EAR:

    I have been removing the keys one by one, unplugging the keyboard and shooting I with a firehose for the last 6 months at least once per week. Hope that helps.

    TPC

  28. jnutley says:

    I agree with the fictitious wealth thread.

    I disagree with the “We build value/No we don’t” crew. That argument is completely in the echo chamber. Whether you build battleships or tabletop lamps for Walmart, you have to ask today, “can I sell this, and for how much?” In this time of increasing deflationary pressure that question has no “real” answer, because “wealth” is being destroyed. The airlines of the world will likely cancel more airliner orders, AND the consumers of the first world will leave the cheap clothes on the racks, AND the new middle class in China and India (most of whom get by on about USD$10 per day) are also saving rather than spending. Who will buy? When and and at what price will they buy? Until there are new buyers; no one can tell what will sell, or who will be placed to sell it at best advantage.

  29. royrogers says:

    what about Bernanke pumping 11 trillion back into the economy or wall street ??

  30. try2bamused says:

    Maybe there wouldn’t be so many single-digit stocks now had corporate boards, during fat times, not run their printing presses so that they could reward their CEOs with obscenely lavish option-based compensation packages. Just rewards for top-talent or looting of the corporate treasury?