3 Prior Market Crashes

Today’s chart porn comes to us via Bob Bronson.

Here’s a comparison of 3 prior market crashes: 1930, 1962, 1987 and today. (Note that there is no guarantee that this will be a crash, or if it is it will be the same as those others):

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1930, 1962, 1987, 20084_crashes

Source: Bronson Capital Markets

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We are getting to a point where markets are oversold, and due to
bounce. But understand what odds we are facing here: A deep recession
likely awaits us, and with it, earnings compression, and lower — often
considerably lower — stock prices.

We will hear a lot of noise about Fed action, stimulus plans, etc.
– every reason why you should jump back in here — but all that
intervention will accomplish is delay the inevitable washout.

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UPDATE: January 23, 2008 4:15pm

Wow, that was a helluva bounce.

The rumors of NYS helping to arrange a capital bail out of the monolines didn’t hurt.

And, it can keep going — perhaps over the next few weeks — to SPX 1,400 or so . . .

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