Year: 2025
Type: article
Abstract: This paper analyzes eight financial market crashes in the U.S. spanning the period from 1920 to 2024. I found that these events negatively impact the economy, employment, and the purchasing power of people. Additionally, I found that financial markets begin to diverge from economic activity, as measured by real GDP and the fixed income market indicators, prior to the crashes. I also observed that professional market participants usually do not anticipate these market events and remain very optimistic about quick market recovery immediately following the crash. Finally, I found that it takes up to three years for employment levels to return to normal, which is significantly longer than it takes consumer prices to recover to pre-crash levels.
Source: Journal of Student Research
Author: Marta Pauksta
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4413512859