Top Five DOW Drops of All Time

 Typically, folks want to believe the five are all in the 1929 period, which is not true:

1.  19 October 1987: 22.6-percent drop

2.  16 March 2020: 12.9-percent drop

3.  28 October 1929: 12.8-percent drop

4.  29 October 1929: 11.7-percent drop

5.  12 March 2020: 9.9-percent drop

The chief problem with 'drops' in the DOW.....people are standing there in shock that futures crowd suddenly shifted, and in a matter of 10 minutes....your portfolio of $100,000 is suddenly valued at $90,000.  

In this modern era, over the past twenty years....people have even taken to tools to order the 'system' to sell stock in a hurry if the price drops below x-amount.  So you could have a rule in the system....put there five years ago (which you may or may not remember) that if the stock price drops below $50 (presently at $60) to automatically sell.  

This type of automatic selling creates a massive wave that the system cannot see clearly or control the flow of things....so the pain involved (like in March 2020) is more severe than you can imagine.  

What makes a major difference between now and 1929?  Two things.

1.  Banks are regularly audited and controlled....so you don't have banks standing there with fake books, and fake numbers (that was highly the case in 1929).

2.  Retirement account (IRA folks)....now present a massive part of their structure to the nation....something that didn't really exist in 1929.