Predictable market chaos ahead

With margin debt reaching the levels seen before the 2000 and 2008 crashes, there's plenty to fuel a very large, and not-so-random, correction.

The past week’s stockmarket volatility, and its decline over the past month, has reminded us that many of the market’s greatest falls have occurred in October. There was the Great Crash of October 28-29 in 1929, when the market fell 13 per cent and 12 per cent on consecutive days; October 19 for the 1987 crash (at 23 per cent still the biggest one-day fall in the market’s history); and October 15 2008, when it fell a comparatively piddling 8 per cent, but coincided with the biggest economic downturn since the Great Depression. 

Is October the market’s ‘witching month’?


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