Word: stockings
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Dates: during 1990-1999
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...turmoil on Wall Street was the latest in a summer-long slide that has knocked almost 740 points, or nearly 8%, off the Dow index since July 17, a decline that economists call a correction. (A 20% drop signals a "bear market.") But a deeper and quieter sort of stock decline has been under way much longer, particularly among smaller companies. For example, the Russell 2000 Index of small-capitalization stocks has fallen nearly 5% since January. Investors have been seeing these declines for some months in their brokerage statements. So as they survey the carnage, a question naturally arises...
...forecast can measure the volcanic threat created by the crisis in Asia. Economists generally blame the drop in stocks on slumping U.S. exports to the stricken region. The decline limited the growth of U.S. corporate earnings--a key determinant of stock prices--with industries from chemicals to aerospace reporting lower profits in the second quarter than in the same period a year ago. "Asia is unpredictable," says Allen Sinai, chief global economist for Primark Decision Economics. "I can't guarantee that there will be no recession in the U.S. next year because no one can be sure about Asia." Observes...
...last line of defense for the U.S. economy is the Federal Reserve, which has the power to cut interest rates if the expansion falters. But Fed Chairman Alan Greenspan, who warned of "irrational exuberance" in stock prices as far back as December 1996, remains more concerned about the threat of inflation than about the danger of a recession or a market collapse. Just last month Greenspan warned that plunging exports to Asia had done little to ease a growing U.S. labor shortage...
...that was before last week's drop in the stock market, which fostered a sense that slower growth lies ahead. And the wealth effect could greatly worsen matters if stocks really hit the skids. "We've got a market that's doubled in the last three years," says Stephen Roach, chief economist at Morgan Stanley Dean Witter. "If you lose 10% or 20% after doubling, that's not real pain. But if you take this correction into the 25% range, the market could hurt more going down than it helped going up." That's because people often feel worse about...
...experts expect stocks to take so big a fall. Most agree that what we saw last week did not reflect any disastrous weakening of the U.S. economy. Instead it represented a healthy correction of an overpriced stock market. The good news was that few individual investors seemed to engage in panic selling. But their faith, and their sense of prosperity, will probably be tested again in the weeks and months ahead...