Nasdaq · October 9, 2002
Nine months when the books could not be trusted
-45.90%
peak-to-trough, the whole slide
192 trading days · 2002-01-04 → 2002-10-09
still below that peak today
What happened that day?
- From the high on 4 January 2002 to the low on 9 October, the Nasdaq fell 45.9% over 192 trading days
- This is the final stretch of the dot-com collapse. 9 October is the bottom of the whole bear market
- What broke this time was not prices but belief in the numbers themselves. Frauds at a large energy company and a large telecom were exposed in turn
- If the profit a company reports might not be real, no share can be priced. So companies with sound results fell alongside the rest
- One auditing firm went out of business in the process. The side that was meant to verify the books had itself become untrustworthy
- A law passed that summer making executives personally answerable for the accounts began to lift the distrust
- From this bottom it took fifteen years to regain the high of 2000
Sources
Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.