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Comparing today with Japan's 1990-2 crash
Posted on 08 July 2009 with no comments from readers
A chart is sometimes worth a thousand words, and this one from Alan Brochert speaks volumes. The Japanese lost decade of the 1990s is often used as the most recent example of what follows the kind of bubble that has just ended in US and European financial markets. Here we can see the rally in early 1991 (like today?) and a move sideways (perhaps this summer) and then a 12-month fall to the bottom in summer 1992. Is this where stocks are heading next?
no Comments posted by readers:
Ancient Chinese Proverb Applies Here:
A picture is worth 10,000 words
If it were that easy to predict the future, we would all be millionaires!
Peter,
The past can always tell us a lot about the present and help predict the future.
The chart you presented shows a number of trend reversals.
It would be perhaps more meaningful to extrapolate these trends to today’s situation if you could do two things:
1. Present the reason or reasons driving each trend reversal
2. Show that similar drivers are present in today’s economic environment.
Otherwise it is just another chart from another time.
Cheers,
Keijo
That chart doesn’t even capture the most recent saga down to 7000… down more than 80% from the bubble high.