The 8 biggest U.S. market declines in history

A 20% drop in the index from the highs and more is called a bear market. In mid-June 2022, the S&P 500 Index was already losing as much as 24%, falling from January’s 4,800 points to 3,666. As of early July, the index is holding around 3,800 points.

Talk about the biggest bear markets in U.S. market history – from big drops to smaller ones.

The stock market crash of 1929

The worst U.S. market crash began in September 1929, becoming the catalyst for the Great Depression. This crash ended the “Boom Twenties,” when the stock market rose more than 300 percent.

The cause of the crash was overvalued stocks and the bursting of the debt bubble

Fall: 86%.
Duration: 26 months

The Mortgage Crisis of 2008

The bear market began in October 2007 due to the mortgage crisis in the U.S.: falling home sales, coupled with the dominance of high-risk loans caused problems for large borrowers. The situation was exacerbated by the bankruptcy of Lehman Brothers.

The mortgage bubble burst caused a global financial crisis.

Down 57%
Duration: 17 months

The Roosevelt Recession of 1937

The market decline began in March 1937, and its pace eclipsed even 1929: in a few weeks, the S&P 500 Index lost a third of its value, and corporate profits collapsed by 80%.

The market decline and the economic downturn are attributed to the “New Deal” policies of the Roosevelt administration

Fall: 55%
Duration: 13 months

The dot-com bubble of 2000

In the late 1990s there was a boom in tech companies: the Nasdaq index grew fivefold in five years. In March 2000, the dot-com bubble began to deflate. All this was accompanied by a recession in the economy.

The main reason for the collapse was overvalued IT companies, many of which were junk and unprofitable

Decline: 49%
Duration: 30 months

The Oil Crisis of 1973

In October 1973, Arab countries refused to supply oil to the United States and Western countries that supported Israel in the Arab-Israeli conflict.

The surge in energy prices caused a spike in inflation and a slowdown of the economy – i.e., stagflation

Downfall: 48%
Duration: 21 months

The collapse of technology stocks in 1968

In the late 1960s, the U.S. was in turmoil over the Vietnam War, and the economy was in a shaky state. But the S&P 500 rose steadily, up 16.12 percent in 1967 and more than 10 percent by November 1968.

The triggers for the market decline were inflation and Fed policy tightening

Fall: 36%.
Duration: 18 months

Black Monday 1987

The fall in August 1987 occurred for no economic or geopolitical reason. The S&P 500 fell 20.5% in one session.

This is the bear market of those that were not accompanied by a recession. Causes were trading program glitches, low liquidity, overvalued stocks and investor panic

Decline: 34%
Duration: 3 months

Coronavirus recession 2020

February 2020 was the shortest bear market in history: the decline lasted only a month. And by August, the S&P 500 had already fully recovered from the slump.

Causes of the recession and decline included coronavirus restrictions, logistics disruptions, lower manufacturing and buying activity

Fall: 34%.
Duration: one month

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