ASX Market Crash January 2008

All Ords Longterm Trends in 2008
Uploaded with plasq‘s Skitch!

Today the Australian markets have had a serious downturn, will this be known as the crash of 2008 or just the start of the crash of 2008? Take a look at the graph and see what you think … the All Ords closed today at 5222.

Mark Pesce asked on Twitter today about a longterm trendline for the ASX, not having one to hand I thought I’d give Skitch a workout and make my own. Too easy!

Then I got interested – going on rough trendlines since 1985 our market could drop another 1,000 points and still be inside the trendlines!

I would prefer to go back further than 1985, and also to see the graphs of PE ratios inflation adjusted that Robert Shiller published in his book Irrational Exuberance. That is a must read for anyone interested in financial markets, most especially when we have events like these.

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