With more than 2,800 companies on the US stock market with a combined worth of over $21 trillion, ups and downs are bound to happen. In fact, stock market crash statistics show these happen fairly regularly, but so do major market recoveries. Currently, the ongoing COVID-19 pandemic is not only threatening humanity, but it’s also taking its toll on the stock market as well. Whenever a market crashes, stocks fall by 10%, which happens more often than people might think.
Still, these crashes last only for a day, and the market goes on to recover afterward.
Yet, what happens when the market does not recover in a single day and when stocks fall by more than 10%?
Read the following stats to find out!
Top 10 Facts & Stock Market Crash Statistics for 2022
- The stock market crash of 1929 began when the market opened 11% lower than the previous day’s close.
- 25% was the unemployment rate during the Great Depression.
- With more than $200 million in deposits, New York’s Bank of the United States collapsed in 1931.
- The 1987 stock market crash caused the US markets to fall by more than 20% in one day.
- The coronavirus stock market crash was the most severe and the shortest so far.
- The 1999–2000 dot-com crash cost investors $5 trillion.
- It took almost 17 years for tech stocks to recover from the dot-com crash.
- The 2008 market crash increased the unemployment rate to 10%.
- From 2007 to 2009, the Great Recession destroyed a $16.4 trillion net household wealth in America.
- The stock market crashes are common but unpredictable.
Keep scrolling to learn more about the biggest financial crises in US history, the consequences, what caused them, and how the economy eventually recovered.
The 1929 Stock Market Crash Facts
What caused the Great Crash in 1929? What exactly was going on during the Great Depression?
1. The stock market crash of 1929 began when the market opened 11% lower than the previous day’s close.
(Investopedia)
October 24, 1929, is marked in history as “Black Thursday.” Various financiers and institutions tried to stop the panic by bidding above the market price. The day’s losses were minimal, and stocks appeared to have bounced back over the following two days.
However, the stock market crash timeline of that era shows stocks fell by an additional 13% on Monday. “Black Tuesday” then went on to reveal that any hope of stocks bouncing back was just an illusion when they fell by yet another 12%.
Consequently, the Wall Street crash officially started — and the rest is history.
2. From 1922 to 1929, the stock market increased by 20% per annum.
(History)
During the “Roaring Twenties,” the American stock market was booming. The economy expanded rapidly, and stocks hit an all-time high. Likewise, the market peaked when the Dow hit 381 points.
Exactly what caused the stock market crash of 1929 answers many questions people had on their minds these past few weeks. For one, it was overconfidence and overspending.
People were overly confident in the US economy — hence why they bought stock shares on credit, and the government raised the interest rate from 5% to 6%.
3. Even though the US stock market crash happened in 1929, the stocks kept falling for another 3 years.
(CNN Business)
Between September 1929 and June 1932, the Composite Price Index fell by 86%, hitting an all-time low, as the 1929 stock market crash chart shows.
The stock market crash was one of the leading causes of the Great Depression. As a result, financial markets took a few years to recover from this period (from 1932 to 1937).
4. 25% was the unemployment rate during the Great Depression.
(Fact Retriever)
According to the Great Depression timeline, the years 1932 and 1933 were the worst by far. One in four people were unemployed, and another 25% had to work part-time or take wage cuts.
When it comes to the stock market crash of 1929 facts, they reveal that the GDP fell by almost 50%.
5. With more than $200 million in deposits, New York’s Bank of the United States collapsed in 1931.
(History)
The Great Depression started as an ordinary recession, but it very quickly escalated into an economic disaster. People started pulling their investments out of the economy, plus they were spending less money.
As a result, bankruptcies became common. About 1,300 banks failed over a single year, as the Great Depression stock market crash facts of that period show.
6. Approximately 750,000 farms were lost between 1930 and 1935 due to bankruptcy or sheriff sales.
(Fact Retriever)
During the Depression era, farms were often auctioned at so-called “Penny Auctions.” There, farmers helped their distressed neighbours by keeping the bids down to quarters, nickels, and pennies to make sure they could buy back their old farms.
What’s more, auction scenes often had dangling nooses to discourage those who wanted to make higher bids.
7. Stock market crash 1929 facts indicate that stocks took about 5 years to recover.
(Business Insider)
Investors who had stocks at the start of the 1929 crash recouped their losses in 4.5 years.
Still, it took the Dow 25 years to regain the highs they had back in 1929. Moreover, Dow investors needed some 10 years to get their money back, including dividends.
More Recent Stock Market Crash Statistics
How many times did the world witness a crash of stock markets?
8. The 1987 stock market crash caused the US markets to fall by more than 20% in one day.
(Investopedia)
The 1987 “Black Monday” struck not only the US economy but markets all around the world.
Financial experts assume that the computerized stock trading programs were the main culprits. The programs had set a point at which they automatically sold stocks, and they all acted at once, thus causing the said crash.
9. When it comes to the stock market crash of 1987 timeline, reports indicate that the Dow regained 288 points in three days following the “Black Monday.”
(The Street)
Unlike the 1929 stock market crash, which took almost 25 years to recover, the 1987 market started recovering almost immediately. There were no long-lasting effects on the US economy. The Dow recovered all their stock market losses by September 1989.
10. The 1987 stock market crash increased hospital admissions by 5%.
(Proactive Investors)
Some surprising facts about the stock market crash of 1987 — the hit was so bad that hospital admissions grew exponentially. The majority of cases were of a psychological nature, such as depression, anxiety, and panic disorders.
11. The 1999–2000 dot-com crash cost investors $5 trillion.
(Money Crashers)
During the late 90s, the internet generated a lot of excitement for online business and commerce.
Investors assumed that any company that operated online would be worth millions. Naturally, not all internet companies were as successful as Google (for instance). Many of them crashed, leaving investors with substantial losses.
12. Additional facts about the stock market crash of 2000 — new internet companies were overvalued by 40%.
(Money Crashers)
The largest bank globally, HSBC Holdings, conducted some extensive research on these new internet companies that were the latest rage.
They discovered that to be valued appropriately, these companies’ revenue would have to grow by 80% per annum over the course of five years, which is practically impossible for any company.
13. It took almost 17 years for tech stocks to recover from the dot-com crash, the stock market crashes timeline shows.
(Money)
In 2017, the S&P 500 Information Technology Index broke the previous record of 988.5 points, reaching a new high of 992.3 points. Moreover, in the following years, tech shares lost 80% of their value.
The recovery was extremely slow but efficient. After a long 17 year period, tech stocks traded at a price/earnings ratio of 18.4.
14. When did the stock market crash in 2008? On September 29, when the Dow plummeted by 777.68 points.
(The Balance)
In a nutshell, the fall occurred because Congress refused the bank bailout bill. Yet, it is simply a climax of lots of different stresses.
In the following month, Congress passed the bailout bill successfully. However, it was too late. In other words, stock market crash statistics indicate 159,000 jobs were already lost in September.
This Dow decline was the greatest point drop in history till the 2020 crash happened.
15. From 2007 to 2009, the Great Recession destroyed a $16.4 trillion net household wealth in America.
(Money Morning)
According to the 2008 stock market crash chart, it fell from $65.8 trillion in 2007 all the way to $49.4 trillion in 2009. Furthermore, the stock market crash statistics report the market havoc also destroyed more than $2 trillion in retirement savings, endangering the personal finances and millions of Americans’ life savings.
16. The 2008 market crash increased the unemployment rate to 10%.
(A Digital Blogger) (The Independent Market Observer)
It’s estimated that 8.7 million people lost their jobs in an economy that had not yet fully recovered from the 2000 dot-com stock market crash.
Moreover, since 1966, there have been stock market crashes every 7 years, which is a pretty good indicator of the things that are yet to come.
17. The declining stocks and the decrease in home value destroyed almost $100,000 per household at the crash’s very peak.
(Wealthsimple)
During the late 1990s, lenders provided loans and credit to people who were not qualified or had lower credit scores, which caused the stock market crash of 2008.
Fannie Mae wanted to fulfill everyone’s dream of owning a home, but this only drove the housing prices to go up to levels that not a whole many could afford.
Furthermore, housing prices were increasing continuously while the mortgage market flourished. The result was the loss of home values together with the fall of stocks. Although the World Bank predicted that the situation is alarming, nothing could stop the 2008 stock market crash.
18. When did the stock market crash in 2020? It started on March 9 when the Dow fell 2,014 points.
(Forbes)
The stock market crash started on March 9 when the Dow witnessed a 7.79% drop — it fell 2,014 points.
Generally speaking, the crisis wasn’t over, given that there was another drop three days after. The Dow had another fall of 2,352 points (9.99% drop).
The third wave happened on the 16th of March when the Dow fell almost 3,000 points (12.9% drop).
19. The market started rebounding in April due to Congress and the Fed’s help.
(Forbes)
Many people were asking themselves, will the stock market crash in 2020? While the worst happened, luckily, the market started bouncing back with a bit of help from Congress and the Fed.
First, they cut the interest rates to almost zero. After that, they launched a rescue package of $2.3 trillion to help businesses, markets, local governments, and households.
The US markets managed to return to the same levels they had in January by November, and the Dow hit 30,000 for the first time.
Stock Market Crash vs. Coronavirus — Lessons and Predictions
What did we learn from the market crash in 2020, and what can we expect in the following period?
20. The stock market crashes are common but unpredictable.
(The Motley Fool)
The covid crisis was a harsh teacher for investors. Not only was the word unprepared for the pandemic, but the stock market was also in the dark. History taught us that stock market crashes are pretty common. The only problem is that we can’t predict when exactly they will happen.
For example, the S&P 500 has made 38 declines since 1950. In other words, there’s a decline every 1.87 years.
21. The coronavirus stock market crash was the most severe and the shortest so far.
(Statista) (Morning Star)
The US stock market got hit pretty hard on March 23, 2020. The three major stock markets (the Dow, S&P 500, and Nasdaq) witnessed a massive drop of over 30%.
That said, today, all three markets managed to get out of the crisis by elevating 76.05% (the Dow Jones), 76.12% (S&P 500), and 94.99% (Nasdaq).
22. Stock market crash statistics show that there’s no market timing.
(Forbes)
What does it mean? First of all, the best days and the worst days of stock markets are close to one another.
For example, the worst day for S&P 500 happened on March 12th, 2020, when it lost 9.5%. The situation changed on the 13th of March when they returned 9.3%. In other words, the best days come after the crisis.
This means that the stock market has no timing, and investors must follow the situation on a daily basis.
FAQs
What were the biggest stock market crashes by percentage?
The top three are:
- The Wall Street Crash (1929) was the biggest crash by percentage, with -33.6%.
- Black Monday (1987) took second place with -31.3%.
- End of Gold Standard (1931) is the “lucky” third contestant with -26.7%.
Honourable mentions:
- Lehman Crisis (2008): -25.2%
- World War II (1940): -24.6%
- COVID-19 (2020): -20.7%
- Dot-com Bubble (2002): -19.3%
- Post World War II Demand Shock (1946): -16.9%
- US Debt Downgrade (2011): -16.7%
- Great Financial Crisis (2009): -13.8%
- LTCM (1998): -8.7%.
How many times has the stock market crashed?
The stock market has witnessed eight big crashes so far. The first one happened in 1907 when investors borrowed the bank’s money to finance the shares of UCC (United Copper Company). The stock value loss amounted to 15%–20% of their value.
The following one was the biggest on the stock market crash history timeline. The infamous 1929’s Wall Street Crash, when the market lost 85% of its value.
The 1987’s “Black Monday” was the third major market crash. Nasdaq lost 11%, and the Dow and S&P 500 dropped over 20%.
In 1992, there was a Japanese Asset Bubble Burst, followed by Asia Financial Crash in 1997, Dot-Com Bubble Burst in 2000, Subprime Mortgage Crisis in 2007-2008, and the 2020’s coronavirus market crash.
How bad was the Stock Market Crash in 2020?
It was a pretty dramatic stock market crash, one of the most severe in history. For example, the Dow lost 6,400 points in only four days (26%). In a like manner, the unemployment rates in the US reached over 20%.
The companies that worked in the petroleum sector witnessed the biggest market value losses. Over 60% within a day!
On the other hand, it was also one of the shortest crashes and certain industries flourished.
What percentage did the stock market drop in 2008?
It dropped by more than 30%. In fact, 2008 was the year of the great mortgage and credit crisis, the bank collapse, and the government bailout. This was also the period when some of the greatest financial markets lost a significant percentage of their value.
In short, from September to October 2008, the Dow fell by 3,600 points, which was the largest point loss in history.
Why is the stock market crashing?
Nowadays, the stock market is in danger of crashing due to an external health factor, i.e. the coronavirus pandemic. Conversely, the culprits for previous stock market crashes were of financial nature. For instance, computer trading, overselling of tech companies, and so on.
Did the stock market recover in 2020?
Yes, the stock market regained its ground in 2020. Not only did it recover, but it also managed to evolve. The stock market crash facts show us that a year after the beginning of the pandemic, stocks got 79% from the lows. What’s more, younger investors showed more interest in the market.
The current leaders of the market are the energy, industrials, materials, and financial sectors. This might seem a bit unusual. Still, take into consideration that recovery-themed stocks are presently the “new normal” for investors.
Can the stock market crash today?
We already mentioned that the market is unpredictable. It could crash in less than a day and bounce short after. If the stock market crashes, the main reasons would be the pandemic, unemployment, and inflation.
Since the pandemic is still ongoing, there’s no way of knowing how or when it will end. The unemployment rates are still an issue, while inflation might become the world’s biggest problem.
The Bottom Line
Stock market crashes are the result of a series of events leading to the failure of some of the greatest companies. They affect banks and financial institutions alike, as well as the lives of the general population, their jobs, homes, and savings.
These stock market crash statistics show that the modern-day economy is not only fragile but also ever-shifting. Still, at the end of the day, no matter how great a market crash, there will almost surely always be a recovery.
Sources:
- A Digital Blogger
- Business Insider
- Business Insider
- CNBC
- CNBC
- CNN Business
- Fact Retriever
- Forbes
- Forbes
- History
- History
- Investopedia
- Investopedia
- Investopedia
- Money
- Money Crashers
- Money Morning
- Morning Star
- NCBI
- Proactive Investors
- Ramsey
- Statista
- The Balance
- The Independent Market Observer
- The Motley Fool
- The Motley Fool
- The Street
- Wealthsimple
