The Stock Market Crash of 1999 repeats in 2013

 

by John Galt
February 20, 2013 19:30 ET

 

Hmmm, heard this before?

Nah, it’s the 1920′s ladies, Kwamer said so:

 

Wait a second. Oil prices going up are bad? Didn’t we hear in 2007 and 2008 that this indicated a bull market was going to extend all the way to Dow 20,000?

Nah, people are not stupid enough to get washed, laundered, rinsed, and raped again are they?

Ah, uh, yeah, from the New York Times on January 25, 2013:

As Worries Ebb, Small Investors Propel Markets

Been there, done that, seen the sick sorry movie when the .com’s started to fall to hell in a hand basket after the investment banksters raped the stupid “small investors” who thought that the concept of getting 50 lb. bags of Gravy Train shipped to their homes was “brilliant” and a sure fire money maker.

petsdotcom

Thus we watched the markets implode and to give one some perspective, here is the chart of the S&P 500 from July 1998 to the end of May 2001 courtesy of StockCharts.com:

SPX_3YR_JUL1998_MAY2001

Does today’s current market with over 500 days and counting without any significant correction look familiar to anyone?

SPX_3YR_DAILY

But don’t look at the numbers, read the headlines and understand that Obama would never lie to the citizens and the stock market will go up forever because the Bernank will print bull-crap until the dollar appears to look like some African banana republic’s paper fiat crappola:

ZIMBABWE_100TRILLION_BILL

So what happened after the initial crash of 1999 to 2001? Did the markets bounce back and rally up to September 11, 2001 as many “experts” projected after the initial correction?

Uh, no. Here is the chart from December 1, 1999 until September 7, 2001:

SPX_3YR_DEC1999_SEPT_7_2001

The initial 30%+ correction was nasty, sharp, and caught most “small investors” blaming their brokers for ineptitude, fraud, and refusing to answer the phone to desperate retirees convinced that Netscape and other .com ventures would never, ever, ever, ever, ever, ever, ever, go bankrupt and that they were as strong as Apple Computer (Symbol: AAPL).

AAPL_3YR_JUL1998_MAY2001

Since I’ve taken a bite out of the Apple and looked at what the S&P 500 did, why not a quick look at Professor Dollar during the same 1998-2001 time period:

USD_3YR_JUL1998_MAY2001

Not saying that this could happen again, but do not be shocked if the USD moves from the 81 level to above 89 in very, very short order, especially if the Middle East blows up with short notice.

Over the next month or two, many of my readers will hear the following:

“It can’t happen here.”

“This time it’s different.”

“The Fed has the stock market’s back.”
“The economy is so well managed, crashes are rare if not impossible thanks to our modern system of regulation and the Federal Reserve.” (or words to that effect)

Prepare for the impossible, different, and disastrous as once again the lemming behavior of man, as guided by computer programs that man created, create an untenable market situation that was theoretically never suppose to happen again after 1929; or 1987; or 2008; or 2010…..

dancinbernankejgfla

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