ABC News: 20 Years Later: Could Stocks Crash Again?:
Twenty years ago today, the U.S. stock market suffered its worst one-day drop ever: the Crash of ’87. The Dow Jones industrials plunged 508 points, or 22.6 percent, as waves of selling swamped the New York Stock Exchange. It was a market dislocation so intense that some pundits predicted another Great Depression.
I was a freshman at NYU, rooming with a finance major, and I heard what had happened– and wondered how bad it was going to be. I was up late that night, and walked out of my dorm on 5th Avenue (Rubin, if you must know) wondering how the world was going to change as a result.
And I was looking to the north when I saw the lights of the Empire State Building go out.
I was pretty new to the city, I didn’t know they turned out the lights every night. And only a few months earlier, I had read Atlas Shrugged, which ends with the lights of the Empire State Building and New York going out.
Brrrrrrr.
But then I looked to the south, and I was reassured– the lights were still on down there, at the World Trade Center. Everything was going to be okay.
Amazing how things can change in a few years, eh?
As someone who has not been able to GIVE a house away in 10 months, at the moment I see nothing but recession around me. Last week, there were Zero property transfers in my town. The only books doing hot business are career change books, resume writing, and business books. The Peter-Paul Cadbury candy factory (sorry, no oompah-loompahs) will close its doors in December, dropping more than a hundred people onto the unemployment rosters.
Maybe its just New England, but I’ve heard the same dire stories from Florida, too.
I’m holding out hope for 1/20/09.
Susan, where in New England are you?
New Haven County, CT
Interesting. I’ve been hearing some similar things, including some people who can’t unload houses in some very pricey areas of CT. So I’m intrigued.
The really pricey houses are still selling, and the ones that are cheap but in good condition. It’s the moderately-priced that can’t move. The rest that don’t move all have real problems – electric heat (lethal in CT, as our electric rates are astronomical), mold, no basements, or ridiculously priced. We’re asking $100,000 below market value – and yes, though we bought low we’re still taking a considerable hit – and we still can’t get a buyer. We’re a pricey town with generally low crime (outside of one very nasty murder), and allegedly “Blue-Ribbon” schools (I beg to differ), with easy access to all major highways, which makes us a “highly desirable location”, with walking distance to 2 schools, a park, and shopping. There have been some interested parties, but few people can get mortgage commitment right now. Thankfully, we have a house to return to (house #1 that wouldn’t sell for 10 months, even though we dropped the price 75,000 and it was the best bargain in town). If push comes to shove, the bank can take the 2nd house. I don’t care any more.
In Texas (Dallas), it’s the high-end real estate market that’s been hit. It’s mostly due to all the foreclosures on homes that were affordable at rates 5-7 years ago. I just can’t help but wonder why anyone would by an ARM at some of the lowest rates (ever!) in the mortgage market. The entry and mid-level priced homes seem to be moving normally.
Dallas was hit hard by the tech bubble bursting in the early 2000s, but now the local economy seems to be on a decent track. At my company, we have regular rates of turnover for all the usual reasons – moving, better pay, etc.