The Dow Has Fallen Nearly 1,500 Points From The Peak Of The Market, And Many Believe This “October Panic” Is Just Beginning…

Friday, October 19, 2018
By Paul Martin

By Michael Snyder
TheEconomicCollapseBlog.com
October 19,2018

We haven’t had an October like this in a very long time. The Dow Jones Industrial Average was down another 327 points on Thursday, and overall the Dow is now down close to 1,500 points from the peak of the market. Unlike much of the rest of the world, it is still too early to say that the U.S. is facing a new “financial crisis”, but if stocks continue to plunge like this one won’t be too far away. And as you will see below, many believe that what we have seen so far is just the start of a huge wave of selling. Of course it would be extremely convenient for Democrats if stocks did crash, because it would give them a much better chance of doing well in the midterm elections. This is the most heated midterm election season that I can ever remember, and what U.S. voters choose to do at the polls in November is going to have very serious implications for the immediate future of our country.

After a very brief rally earlier in the week, stocks have been getting hammered again. The S&P 500 has now fallen for 9 out of the last 11 trading sessions, and homebuilder stocks have now fallen for 19 of the last 22 trading sessions. It was a “sea of red” on Thursday, and some of the stocks that are widely considered to be “economic bellwethers” were among those that got hit the hardest…

Several stocks seen as economic bellwethers fell sharply in the U.S., including United Rentals and Textron, which dropped at least 11 percent each. Snap-on and Caterpillar, meanwhile, fell 9.6 percent and 3.9 percent, respectively.

Hopefully we will see another bounce on Friday, but at this moment it looks like things could go either way.

But no matter what happens on Friday, many are convinced that the worst is yet to come, and here are some of the reasons…

China

Chinese stocks have fallen 12 percent so far this month, and overall they are down 26 percent over the last 12 months.

That means that China is now well into a bear market.

And history tells us that when Chinese stocks fall 10 percent or more within 30 days, that is usually very bad news for U.S. stocks. The following comes from CNBC…

But a study by CNBC using analytics tool Kensho found that U.S. stocks are more often weaker when the declines in Chinese stocks are large. Over the past 10 years, when Shanghai stocks fell 10 percent or more in a 30-day period, the U.S. stock market was up only about 30 percent of the time, and the U.S. indexes all averaged significant declines.

For instance, the S&P 500 on average fell 4.8 percent when China was down 10 percent or more, and the Nasdaq was even worse with a loss of 5.3 percent.

The Rest…HERE

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