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Comparing Bear Markets - 1973 and 2000

Published online by Cambridge University Press:  26 March 2020

E. Philip Davis
E. Philip Davis*
Affiliation:
Brunel University, Uxbridge, Middlesex UB3 4PH, United Kingdom NIESR
*
e-mail [email protected], website: www.geocities.com/e_philip_davis
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Abstract

In nominal terms, the fall in global share prices since 1999/2000 bears a close resemblance to that experienced worldwide in the years following 1972/3. This article seeks to compare the two periods of market weakness in the G-7 countries in terms not only of share prices but also focusing on macroeconomic trends, financial market developments, sectoral patterns of shareholding and potential wider economic consequences of falling share prices. It is shown that the earlier period was much more severe in terms of adverse economic developments, in particular high inflation. But the current situation also presents some risks, in particular a disruptive correction of US sectoral imbalances.

Type
Articles
Information
National Institute Economic Review , Volume 183 , January 2003 , pp. 78 - 89
Copyright
Copyright © 2003 National Institute of Economic and Social Research

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Footnotes

∗

The author thanks Ray Barrell, Joseph Byrne and Martin Weale for helpful suggestions.

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