A Look Back at August 2011

Here’s a look at what the market was doing two years ago from Gary Alexander:

As we enter a new month this morning, we can look back at a healthy (+5%) July, year-to-date gains of nearly 20% and an astounding 154% rise in the S&P 500 since March 9, 2009. But perhaps the most amazing measuring rod is the 51% gain since the market collapsed so sharply in August of 2011.

On August 2, 2011, Congress ended their month-long highly-contentious debt-ceiling debate when President Obama signed the Budget Control Act of 2011. The Dow fell 265.87 that day. Then, the Dow fell another 512.76 points on August 4, based on fears of the S&P downgrade of America’s credit rating. Then, over the next week, the Dow rose or fell by 423 points or more points in four consecutive days:

Manic-Depressive Market Mood Swings, August 8-11, 2011
Monday, August 8, Down 644.76, -5.55%
Tuesday, August 9, Up 429.92, +3.98%
Wednesday, August 10, Down 519.83, -4.62%
Thursday, August 11, Up 423.37, +3.95%

The S&P debt downgrade may explain the knee-jerk 645-point drop on Monday, August 8, but it does not explain the euphoria represented by two days of 420+ point gains on Tuesday and Thursday that week.

Posted by on August 2nd, 2013 at 11:57 am


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