It's Halloween, and we're used to seeing lot's of spooky decorations and getups today. But few of us want to see something really terrifying -- like the volatility of 2008's fourth quarter come back to life.
Yet, we've been forced to, as comparisons of current market conditions to that period have run rampant, complete with chart overlays suggesting similar market actions.
But take a deep breath: It's too early to completely rule out "another 2008" from occurring this year, but during the past three weeks, the current market has taken a different -- less dark -- path than it did that year.
Yes, there has been volatility. In the past 15 trading days, the S&P 500 has closed up or down at least 1%, which is my definition of a "volatile day" -- on eight occasions. But the movement has been positive on seven out of those eight days. There were five occurrences of 2% or higher moves, but over 2.65% on Oct. 17 was the biggest move. During that period, the index is up 8%.
That same three-week period of monumental volatility in 2008, which I reviewed recently, was among the more volatile periods we've experienced in the market. We were hit with 13-volatile days, and the moves were massive on many of those days. Let's review that time 14 years ago:
Oct. 8: -1.13%
Oct. 9: -7.62%
Oct. 10: -1.18%
Oct. 13: +11.58%
Oct. 14: -.53%
Oct. 15: -9.03% (Can you hear the screams?)
Oct. 16: +4.25%
Oct. 17: -.62%
Oct. 20: +4.77%
Oct. 21: -3.08%
Oct. 22: -6.1%
Oct. 23: +1.26%
Oct. 24: -3.45%
Oct. 27: -3.18%
Oct. 28: +10.79%
During that period, the index was down 5.6%; as crazy as that seems, given the two 10% up days the S&P 500 ad on Oct. 13 and Oct. 28. Year-to-date in 2022, the S&P 500 is down about 17%; through Oct. 28, 2008, the index was down about 36%.
I don't know if such comparisons are meaningful, or worthwhile, nor am I trying to make the case that all is right with the markets. I am just trying to put some context around the current markets, and the market period from 2008-2009 that we anchor to when we begin to panic.
In case you are curious, and for what its worth, from Oct. 29 to Dec. 31, 2008, the S&P was down about an additional 4%. Scary?