Nearly 12 Year Low

Well, November 20 lows didn’t hold today, and both S& 500 and Dow Jones closed at nearly 12 year lows, at early 1997 levels.  The Nasdaq so far managed to perform a little better and avoided setting its own low mark.

There were only two other periods in stock market history when stocks moved sideways for an extended period of time.  It took the market 25 years to recover to 1929 levels after the Great Depression (although stocks spent most of that time climbing since hitting bottom in 1932).  The other period on the road to nowhere was from 1966 to 1982.

No one knows how long this period will last.  It is likely, however, that markets will continue its downward movement at least for the short term.  The pervasive pessimism and the loss of key support today could make the market feed on its own negativity for some time.