Page 56 - THE MARKET WHISPERER

54 PART 1 - Allow Me To Introduce You… To The Stock Exchange

At the peak of the crisis, the NASDAQ index representing the
technological stocks lost some 80% of its value, and the S&P 500 lost
46%. I personally experienced this crash as a hi-tech entrepreneur and
beginning trader. I recruited millions of dollars from investors for startups
I established, and rode the peaks and valleys of that period from every
angle possible. These were also my initial years as a trainee trader. In fact,
I owe the positive change in my life to the Dot-Com Crisis, which left me, as
so many others like me, unemployed, and forced me to seek an alternative
in the world of stock trading.

The Credit Crunch (Sub-Prime)

The credit crunch, more commonly known as the “Sub-Prime Crisis,” burst
onto the American market in the summer of 2007 and developed into an
overall worldwide economic crisis. Its opening shot was in September
2008, with the collapse of Lehman Brothers Investment Bank and the
nationalization of AIG Insurance Company. The panic peaked in October
and November 2008, during which the market lost some 30% of its value
(yes, October once again…). Prices continued dropping until they reached
their low in March 2009. In the final run, in just eighteen months from the
October 2007 peak, the market lost 57.4% of its value.

The source of the crisis, as with the 1929 Crash, is in the decade of
almost unlimited credit at low interest rates given to anyone who asked
for it, as well as in the real estate market which developed into a boom,
then burst and dragged worldwide lending banks down with it.

Crises of the Past Decade (S&P 500 Index)

The Dot-Com Crash began in [1] March 2000, dropped until [2] September
2002, and lost a total of 46% value. From this point the market rose to
a peak [3] in October 2007. The Sub-Prime Crash [4] began in October-
November 2008, reaching its lowest point [5] in March 2009.