Nasdaq · October 3, 2011
Five months around a downgrade
-18.71%
peak-to-trough, the whole slide
108 trading days · 2011-04-29 → 2011-10-03
still below that peak today
What happened that day?
- From the high on 29 April 2011 to the low on 3 October, the Nasdaq fell 18.71% over 108 trading days
- The US government spent months fighting over its debt limit and agreed only just before the deadline. In early August a rating agency cut the US government's grade for the first time ever
- What was doubted was not the ability to pay but the willingness. The US borrows in money it issues itself, so it has no reason to be unable to pay
- Oddly, money poured into the very bonds that had been downgraded. It confirmed again that when people are frightened there is nowhere else to go
- In the same months Italian and Spanish borrowing costs jumped. These were far larger countries than Greece, so the scale was different
- The parts shortage caused by Japan's earthquake that March was also still weighing on technology shares
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.