Chart of the day: Dow 1973-1974

By Edward Harrison On Oct 10, 2008

The last time faced a recession and a Bear Market of such viciousness was 35 years ago in the recession of 1973-1975. In the UK, it was truly horrific as inflation shot up to 25% and stocks dropped more than 90% in inflation-adjusted terms.

The Bear market of 1973-1974 simply does not get enough press. As you can see from the chart below, in the U.S. we saw a 40% drop before inflation. With the S&P down 40% from its high right now, our decline is of the same magnitude thus far.

Let’s hope 1973-1974 is a better comparison than the Great Depression or Japan in the 1990s.

This post is part of my chart of the day series.

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Edward Harrison 7783 posts 575 comments

Edward Harrison is a senior Editor at Bloomberg. He is also the founder of Credit Writedowns newsletter, a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.