Stock Markets Exposed
Stock Market Crash?
I was just recently on cnn.com and it said this guy said that god told him all of this stuff involving a stock market crash. I'm learning about the crash that happened a long time ago, but i still don't get it. What is a stock market crash?
Public Comments
- A "crash" is when the stock market loses a certain percentage of it's value in one session. Now...I'm not sure what that percentage is. But that's what a "crash" is. Say that the "Dow" is at 13000 at the end of trading today. Then when it opens tomorrow it drops all the way to (let's say) 8000. That's a crash. But there are safe guards built into the markets that can help prevent that from happening.
- You loose money very quickly.
- I remember the one in 1987. It was a bigger crash than the 1929 crash. The 1929 crash precipitated the Great Depression, but the 1987 crash had little effect on the general population. Those who owned stocks experienced a "paper loss," meaning their stock was worth less, but this meant little unless they wanted to sell it at the time. Those who didn's sell were okay because the stock values went up again later. Also, a lot of people who never owned stock before, decided to buy it after the 1987 crash, believing it would increase in value. They were right of course. The government had put in some safeguards to prevent the catastrophic effects of the 1929 crash. In a stock market crash, it seems that stock owners lose money and nobody gets the money they lost, it just disappears. But somehow it comes back after a time. Obviously I don't understand the principles very well, but I've just observed what happens.
- When the market (the market is defined as the major composit average of stocks, Like the Dow, S&P 500 & Nasdaq) whn, they make a 30% decline in a short time frame (Like a few trading day's) this would be considerd a Crash/ most recent was whn the .com bubble burst in 1999 & the 1995 crash. Will the market really crash, well no1 know's for sure, we did have a 10% correction back in Oct/ Usally the market crashes whn it's least expected, like w the .com bust, every1 was making money in the market, people where quitting work & becoming full time traders; they made more money in one day of trading then working all week, every1 thought the party would never stop & things would just keep going up, stocks like Cisco, Yahoo and other .com where @ all time hi's, but then the bottom fell out and people lost massive amounts of $$$, some .com's whent bankrumpt and lost 100%, Cisco was down like 80-90%; it was truly a black day, some people lost there life savings & some lost even more (some traders even jumped out of window's), but even if you bought a few stocks from the S&P 500 pool a few day's b4 the crash, held them to today, you would still make a yearly profit of around 14%/ example, my bro bought 3 stocks a few weeks b4 the crash, 2 .coms & P&G (Procter & Gamble), w the 2 .com stocks he lost 100% but w P&G he made 500% profit, so it made up for his loss and he still made a good profit, he still holds P&G till this day. (his total investment was 3k, 1k in ech stock, now his stock in P&G is worth around 8k + all the div it erarned).
