Market ups and downs have been tremendous during this 2007-2009 crisis (See the VIX - a volatlity index). However, as Harold Evensky CFP(r) writes in the January 2010 issue of the Journal of Financial Planning, "...they also remind us that extreme events, characterized by volatility jumps, increased risk aversion, negative returns for risky assets, and increased correlations across asset classes, are not a a new phenomenon..."
He cites that there are 10 major market events that happened over the last 21 years, including:
1987 Black Monday drop of 22%+ in one day
1994 Mexican Crisis
1997 Asian Crisis
2000 Tech Bubble
2001 9/11
The 2000-2002 period saw a decline of nearly 50% and that was within this first decade of the 21st century jst past. Yet, this 50% decline of 2007-2009 was faster and accompanied by addition risks to the economy (credit freeze, high unemployment) and therefore different, yes, but not unprecedented. Read about the Panic of 1907 as an example but no FDIC insurance existed, no SEC and many other regulations.
An Introduction
Hi. Welcome to BourGroup and my blog. Phil
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.
Phil Bour is a CERTIFIED FINANCIAL PLANNER(tm) professional since 2004, a Magna Cum Laude college graduate and an accounting professional for over 35+ years. I love numbers, statistics and economic history.
I am also an Enrolled Agent (EA) to represent taxpayers before the Internal Revenue Service and to prepare tax returns.
"Phil"osophy: I believe that you can manage your money on your own (not necessarily through individual stock selection but through mutual funds, ETF's and other solutions) once you receive some one-time, professional guidance. Why pay annual fees when there may be little added value? For additional information, first read the "An Introduction" label at the left. Then move on to others.