Nasdaq · August 3, 2007
The day credit began to freeze
-2.51%
single-day change vs previous close
Part of a longer stretch
Fifteen months that ran right up to the crisis
near the end of it · 2006-07-21 → 2007-10-31, +41.51% over the whole period
What happened that day?
- The Nasdaq fell 2.51% on the day
- The finance chief of a large US investment bank said credit markets were the worst since 1998
- Days earlier a home-loan company had said it could not raise funds. The problem was moving from the loans themselves to the funding behind them
- That structure is dangerous like this — nobody trusts anyone, so short-term lending stops, and then sound companies fail at rollover
- Days later a European bank blocked withdrawals from its funds, an event usually taken as the formal start of the financial crisis
- Even so the Nasdaq rose for three more months, because the trouble was believed to be walled off inside housing
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.