Stocks and bonds by Steven J and Ty L

Stocks today have done a couple of things that have been seen in the past far more then one time. The stocks went soaring up just like always people bought into a lot of it and said that maybe this time would be different, but then like always the stocks came right back down. As you can see, many fell into the trap of thinking the markets could only go one way... UP. Fund managers performed very well, simply buying and holding stocks. The public caught onto the fact that the stock market was the place to make "easy money". Dow Jones doesn't look too bad from a long-term perspective. Look at the huge topping action that started in 1999 and went through until 2001. Only in 2002 did it finally break and give back some big gains. Could the Dow fall to 6,000? Possibly. This is a market indicator- a method of measuring the stock market's performance. The Dow, created over 100 years ago, tracks the performance of 30 well established companies, often called 'blue chips' (there are actually over 12,000 public US companies, but the Dow only measures 30.) While the Dow is the most frequently used index, there are several other market indications such as Standard & Poors.

This other chart is from NASDAQ. This was is much nastier. From 1992 until March 2000 this was a one-stop party for all. (What is NASDAQ? Here is the answer!)National Association of Security Dealers Automated Quotations. The NASDAQ is a computer operated system owned by the NASD that provides dealers with price quotations for stocks and securities traded through the NASDAQ. Also used interchangeably with National Market System. Stocks traded on the NASDAQ are usually the smaller, more volatile corporations and include many start-up companies.

Buy a stock on the NASDAQ, any old stock, and it went up big. But oh boy! When the party finished and the music was over, the hangover was a stinker.

The NASDAQ market has experienced the biggest sell-off. Simply because this is where the biggest "bubble" was to be popped. "POP"... Down you go.

How much further? Take a look at the chart and take your best guess. It's as good as anyone else's. I'll stick my neck on the block and say we are almost there. The "blood letting" is just about complete. Remember, next time we are in a 1992 - 2000 bubble. Make a lot of money, sure. Enjoy the party. BUT realize what has happened in the past will happen again. Be on the lookout for the end. As long as you do that, enjoy yourself.

The 1929 Stock Market Crash

This is the most famous crash in U.S. history. The great U.S depression followed. People who had no business or knowledge of the stock market had borrowed big to invest in stocks. Making the fatal mistake of believing the stock market was a one-way street to fame and fortune. (Sound familiar.)

The 1929 crash was spectacular by any measure. It followed a spectacular bull market that had been going on for the better part of a decade. The Dow Industrials hit a high of 386 in September, 1929. It did not get back to that level until November, 1954. At its worst level, the Dow dropped to 40.56 in July, 1932. That is a drop of 89%.

As bad as the 1929 - 1932 bear market was and it was REALLY bad. It was basically the market realigning themselves with the "normal" gradual up-trend of the stock market. The vertical climb of ten years previous was simply wiped out.

For some reason the loop of the stock market is always the same. New investors come in and invest in certain stocks when they rise up, then the quote of the day is “this time it will be different”, then it crashes again and begins to loop. I think that maybe one of these days, someone will figure out that loop and make a lot of money. My suggestions to doing this are find a stock that people are about to invest in and by it when it’s low, then everyone gets into it and you make a lot of money when its high, and then WHILE its high you go and sell it for a crap load of money. That is just an idea but I think that it would make some serious cash if people got into it. Besides one of these days someone MUST find a way to try to tell where the stocks are going to end up. Maybe there is some type of system of way that things are organized but we can only hope that someone can put two and two together to make things work and make a lot of money. Stevens theory about the stock market is almost the same as mine but a little bit different in the way that he thinks that people should invest in several stocks at one time rather then putting a whole bunch of money in one to increase your chance in making a little bit of money. I think that you should invest a lot of money in one stock to make your winnings larger but a smaller chance of winning.

Between me and Steven we have figured out a lot about stocks and bonds. Smart times to invest and why people do it. This will probably be important to us in the future if we decide to do it ourselves. As for now though I think both Steven and I are happy with our money secured in our pockets!

The PowerPoint, of which we are presenting, should show a little bit more information about how they work using pictures to help guide you along. This has been a fun and educational experience.