The Stock Market Crash of 2007
Stock Market History
The stock market crash of 2007-2009 was one of the most devastating crashes in stock market history. It was led by a real estate or housing market crash.
2007 Housing Market Crash
Some years ago, the powers that be in Washington decided that we didn't need so many banking regulations. Surely bankers could be trusted to lend money responsibly.Lending regulations were loosened. A bunch of shady characters decided to go into the lending business (in addition to the Bank CEOs who were already in it) and the game was afoot. This bunch started lending mortgage money to any and everybody willing to borrow it. They were even using (temporarily) low teaser interest rates to draw the public in. This increased demand for housing and drove prices sky high. Once people saw how quickly real estate prices were rising, flipping houses became the new get rich quick scheme. Prices rose even faster. This led to panic buying on the part of would-be home owners. If they didn't buy now, they would soon be priced out of the market. Prices rose even higher. What goes up must come down and when the housing bubble burst, real estate prices fell hard. Millions of Americans (and countless millions more across the globe) were upside down in their mortgages. To add insult to injury, their interest rates reset and tacked hundreds of dollars more onto their monthly mortgage payments. This led to a barrage of defaults. Which led to a banking crisis. Now, the same banks who just a few years ago were lending money to anyone with a pulse, were unwilling to lend to anybody. As most developed countries run on borrowed money, chaos quickly ensued.
How the Stock Market Crash Unfolded
We heard the first rumblings of trouble in late summer of 2007.The S&P peaked at 1553.08 on July 19, 2007.The markets traded down until they made a temporary bottom at 1406.7 on August 15, 2007.A bear market rally began on August 16th and lasted until October 09, 2007 when the S&P closed at a new high of 1565.15.The next day the markets reversed and began a downward spiral that would last until another temporary bottom formed at 1276.6 on March 3, 2008.A second bear market rally followed. This time the S&P returned to 1426.63 on May 19, 2008 before again reversing.The S&P finally bottomed (at least I hope that was THE bottom) at 676.53 on March 09, 2009. 876.55 points below its July 2007 peak.On March 10th, the markets rallied hard on the news that one of the big banks had FINALLY turned a profit. Everybody wanted back in!As stunning as the fall had been, the bounce off the bottom was just as spectacular. The financial sector (and lots of other sectors) was headed up. If you bought a banking ETF (I was too scared to trade an individual bank because I didn't know which one would go belly up next) the week of March 10th and held it until mid June or so, you would have doubled or nearly doubled your money in 3 months.
Stock Market Crash 1929
Stock market crash 1929 facts. Cause of stock market crash in 1929. What caused the great depression stock market to crash? After the stock market crash of 1929.
Stock Market Crash of 1987
The stock market crash of 1987 was one of the worst crashes in the history of the stock market. At the time, it was likened to the stock market crash of 1929.
Return to Stock Market Crashes
The stock market crashes of 1929, 1987 and 2007. Black Monday 1987. Black Tuesday 1929. Black Thursday. 1929 crash chart.
Return to U.S. Stock Market History
U.S.A. stock market history online. Facts, stock market exchanges. History of the stock market in America. Brief history of stock market trading. Stock market crash history.
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