(OPINION) In 2008, we experienced a nightmarish financial crisis that was felt in every corner of the globe. Is such an event about to happen again? On Friday, the Dow Jones Industrial Average plunged 1,008 points as panic swept through Wall Street in the aftermath of Jerome Powell’s dramatic speech in Wyoming.
Powell made it exceedingly clear that interest rates are going to continue to go up, and that deeply alarmed investors. Some very vocal influencers in the financial community had been anticipating that the interest rate hikes would be ending soon, but now Powell has completely dashed those hopes. Wall Street is going to have to finally face reality in the weeks ahead, and it isn’t going to be pretty.
When I heard that the Dow had fallen 1,008 points on Friday, the last two digits immediately stood out to me. We all remember what happened the last time a year ended in “08”. Could this be a sign that another 2008 is coming? Before you dismiss such a notion, there are other times when a stock market crash has seemed to have been a sign of things to come.
For example, on September 29th, 2008 the entire world was stunned when the Dow Jones Industrial Average dropped 777 points. That was a new all-time record, and fear swept through Wall Street like wildfire. The following comes from a CBS News report that was published in the immediate aftermath of that market crash…
Wall Street watched Washington with shock and fear as the bailout package flamed out on Capital Hill. And as that $700 billion financial rescue plan went down, the Dow went down like a sub, hurtling the Dow Jones industrials down nearly 780 points in its largest one-day point drop ever, reports CBS News correspondent Anthony Mason.
“Nobody could believe it,” said Ted Weisberg of Seaport Securities. “The fact that it did not get done is just mind-boggling.” The result on Wall Street was a history-making 777-point nosedive. The Nasdaq plunged almost 10 percent. Many thought that it was rather odd that the stock market would fall 777 points just as a 7-year Shemitah cycle was ending and a new 7-year Shemitah cycle was beginning.
Rosh Hashanah started on the evening of September 29th, 2008, and all throughout history, we have seen really big things happen on or around the times of major Biblical festivals.
Ultimately, the weeks following September 29th, 2008 were some of the most difficult that we have ever seen for Wall Street. A great financial crisis shook the entire planet, and the U.S. economy plunged into what would become known as “the Great Recession”.
7 years later, there was another stock market crash in 2015. It was immensely painful at the time, but not a lot of people remember it today. Now another 7 years have passed, and it appears that we are on the verge of yet another major panic on Wall Street. Interestingly, another cycle seems to be repeating as well.
As I discussed the other day, this is the 14th anniversary of the housing crash of 2008. But what most people don’t remember is that there was another housing crash 14 years before that in 1994. And if you go back 14 years before that, you will find that the U.S. housing market was crashing in 1980.
Now the U.S. housing market is crashing again, and this one could turn out to be the most painful of them all. If the Federal Reserve would just stop raising interest rates, we may have had a shot at avoiding a complete collapse of the housing bubble. But that isn’t going to happen, and Jerome Powell made that exceptionally clear on Friday morning… READ MORE
