By Albert Laurin, Published: May 26th, 2024 – (Part 1/5, China / USA Probabilty for War)
The United States stock market has a rich history marked by periods of significant growth and devastating declines. Understanding these fluctuations provides insight into the economic and social impacts on both American citizens and the global economy. This article highlights the key bull and bear markets, detailing the events that triggered them and their broader consequences.
The Early Years: 1792 – 1929
The origins of the U.S. stock market trace back to 1792 when 24 stockbrokers signed the Buttonwood Agreement, establishing what would become the New York Stock Exchange (NYSE). The market experienced modest growth until the late 19th and early 20th centuries when industrial expansion fueled significant gains.
The Roaring Twenties and the Great Depression: 1920-1941
Bull Market: 1920-1929
- Start Date: August 24, 1921
- End Date: September 3, 1929
The 1920s, known as the Roaring Twenties, saw a massive economic boom. Advances in technology, mass production, and consumer spending drove the stock market to unprecedented heights. The Dow Jones Industrial Average (DJIA) soared, reflecting widespread optimism and speculative investments.
Bear Market: 1929-1932
- Start Date: September 4, 1929
- End Date: July 8, 1932
The bubble burst on October 29, 1929, known as Black Tuesday. Overleveraged investments and a lack of market regulation led to a catastrophic crash. The DJIA plummeted nearly 90%, signaling the onset of the Great Depression. Unemployment soared, banks failed, and global trade collapsed, profoundly affecting economies worldwide.
Post-War Boom and Recession: 1945-1982
Bull Market: 1949-1968
- Start Date: June 13, 1949
- End Date: December 3, 1968
Post-World War II, the U.S. entered a period of economic prosperity. Industrial production surged, and consumer confidence grew. The DJIA rose steadily, reflecting broad economic growth and technological advancements.
Bear Market: 1968-1982
- Start Date: December 4, 1968
- End Date: August 12, 1982
The Vietnam War, oil shocks, and stagflation characterized this turbulent period. The market faced significant volatility, with the DJIA losing nearly 50% of its value. Inflation eroded purchasing power, and economic growth stagnated, leading to widespread discontent.
The Technology Boom and Bust: 1982-2009
Bull Market: 1982-2000
- Start Date: August 13, 1982
- End Date: March 24, 2000
The longest bull market in history was driven by technological innovation and deregulation. The advent of personal computers, the internet, and biotechnology fueled unprecedented growth. The DJIA rose from around 800 to over 11,000, creating vast wealth and transforming the global economy.
Bear Market: 2000-2002
- Start Date: March 25, 2000
- End Date: October 9, 2002
The dot-com bubble burst as overvalued tech stocks plummeted. The DJIA lost over 30% of its value. Many companies went bankrupt, leading to massive job losses and a reevaluation of tech sector investments.
Bull Market: 2002-2007
- Start Date: October 10, 2002
- End Date: October 9, 2007
Following the dot-com bust, the market recovered, driven by housing and credit booms. Low interest rates and financial innovation spurred growth, and the DJIA reached new highs.
Bear Market: 2007-2009
- Start Date: October 10, 2007
- End Date: March 9, 2009
The subprime mortgage crisis triggered a global financial meltdown. The DJIA fell more than 50%. Major financial institutions collapsed, and the resulting Great Recession led to significant economic hardship, with global impacts.
The Recent Past and Present: 2009-2024
Bull Market: 2009-2020
- Start Date: March 10, 2009
- End Date: February 19, 2020
Post-recession recovery was fueled by quantitative easing and technological advancements. The DJIA rose from around 6,500 to over 29,000, marking one of the longest bull markets.
Bear Market: 2020
- Start Date: February 20, 2020
- End Date: March 23, 2020
The COVID-19 pandemic caused an abrupt market crash. The DJIA dropped over 30% as global economies shut down. Massive fiscal and monetary responses stabilized the markets, leading to a swift recovery.
Bull Market: 2020-Present
- Start Date: March 24, 2020
The market rebounded quickly, driven by unprecedented government support, vaccine rollouts, and technological resilience. The DJIA reached new heights, reflecting robust economic recovery and investor optimism. After a significant drawdown in 2022, the S&P 500 gained more than 26% in 2023. As of this writing, the major US stock indices have breached their 2021 levels and hover close to all-time highs, signaling that a new bull market is underway.
Pre-Conclusion
The U.S. stock market’s history of bull and bear markets reflects broader economic cycles and societal changes. Each period of growth and decline has had profound effects on American citizens and global economies, shaping financial policies and investment strategies. Understanding these patterns helps in navigating future market conditions and preparing for potential economic shifts. With an emerging China on the economic and military geopolitical landscape, in strategic partnership with Russia, we may be entering a new era. The conditions we have today resemble those the world has faced before any world war or great conflict, with the potential for a mighty power to collapse as a new one rises. The USA is greatly divided, but it is a proud nation capable of banding together under the worst conditions. With the Petro-dollar under intense pressure as China trades with Russia in currencies other than the U.S. dollar, there is potential for a system collapse. Recently, China has offloaded $53.3 billion in U.S. bonds, and the Biden administration is gearing up for a contentious election campaign, as has been evident in the last six months, the offloading of such a quantity of bonds and the move away from holding USA assets has significant far reaching impacts, click this link for more information on that front (The Geopolitical Impact of China Offloading American Bonds).
Conclusion
The history of the United States stock market is a narrative of resilience, innovation, and adaptation. From its inception with the Buttonwood Agreement to the technological booms and busts of the 21st century, the stock market has mirrored the broader economic and societal transformations of the nation. The alternating periods of prosperity and decline have not only influenced financial policies but also impacted the lives of millions, shaping their economic realities and future prospects.
As we stand on the brink of a potentially transformative era, with geopolitical shifts and internal divisions posing significant challenges, the lessons from past market cycles are more pertinent than ever. The global balance of power, economic strategies, and national unity will play crucial roles in determining the future trajectory of the U.S. stock market and, by extension, the global economy with the potential of a third world war (WW3) that would devastate humankind and the planet.
In the face of these uncertainties, the resilience and innovative spirit that have characterized the American economy will be vital. By leveraging historical insights and fostering robust economic policies, the United States can navigate these turbulent times, striving to maintain its economic leadership and stability in an ever-evolving global landscape. The ability to adapt and respond to both internal and external pressures will be key to sustaining growth and mitigating risks in the years to come.
So what does it mean for emerging economies to be dumping the American dollar?
A FIVE PART SERIES, PARTS 1 TO 5 SCHEDULED FOR 6AM RELEASE MAY 26 TO MAY 30
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