Stock Market Crash Information

1919 DJIA declined 46.6%. Duration: 21 months.

Three crash phases. I

nitial crash November 1919 to February 1920 (DJIA fell 25% in this first phase).

Second crash in late 1920.

Final crash in summer of 1921. Hit low in June.

Business topped out slowly during the first market crash, then coasted rather indecisively just below its top area for 6 months after the crash. Then it plunged sharply, right after Labor Day, 1920. A depression lasting 1 year followed. Business then recovered simultaneously with the stock market. The year 1921 was notable for a downswing that lasted 6 months nonstop, the second longest downswing in bear market history.

1923 DJIA declined 18.6%. Duration of this baby bear market: 7 months.

1926 DJIA declined 16.6%. Duration of baby bear market: 2 months.

1929 DJIA declined 90.0%. Duration 34 months. Six successive market crashes comprised this famed bear:

(1) September to November 1929 (DJIA fell 40% in this first phase).

(2) April to June 1930.

(3) September to December 1930.

(4) March to May 1931.

(5) July to January 1932.

(6) March to July 1932. A new bull market then started immediately, as did a business recovery.

Business had topped out mildly, a month before the first crash; a gradual mild decline continued to April 1930, then fell sharply into a depression simultaneously with the end of the 1930 stock market rally. The business decline halted in December 1930, stayed level for 6 months, then plunged again in steep economic decline that didnt lose its downward momentum for a full year, until July 1932. Business improved intermittently thereafter but still remained at depression levels through most of the 1930s except for a short recovery in 193637.

1934 Rarely included among bear markets. But a fall of 24.1% in the DJIA gives it a deserved berth here. Duration: 9 months. Then the market took seven more months to get back up to where 1934 began.

1937 DJIA declined 51.8%. Duration: 56 months. Five crash phases:

(1) August to November (DJIA fell 40% in this first phase).

(2) February to March 1938.

(3) January to April 1939.

(4) May 1940.

(5) October 1941 to April 1942.

Business peaked out and fell violently, simultaneously with stocks. Economic indicators bottomed out 9 months later (May 1938). The recovery began mildly at first, but was later boosted by the World War II production boom which eventually lifted the country out of the Great Depression of the 1930s.

The period 194142 contained the longest bear market nonstop downswing (72 months) in history. Certain analysts call this two separate bear markets, one from September 1937 to March 1938, and the second from May 1940 to April 1942. If you are simply looking at market action this view may be correct. But if you take a wider view within the context of the depressed mood of the times, then it can be viewed as all part of a single bear market.

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