The day after President Obama was reveling with rich donors in faux celebration of his 50th birthday, the Down Jones Industrial Average dropped 512.76 points on Thursday to close at 11,383.
During the week of July 17, 2011 the market closed at 12,143.24. In the past 14 trading days the Down Jones Industrial Average has lost six percent of its value. Worse yet, since the week of April 25, 2011 the market has lost more than 11 percent of its value.
The Down Jones opened 2011 at 11,577.43. With yesterday's activity every nickel you thought you'd made this year is gone. And that doesn't even include the value of your house.
Last week, while we were in the throes of the panic surrounding the debt limit negotiations, we were told that, absent a deal, markets would be in turmoil this week. Apparently, no one bothered to call turmoil to tell it the deal was done.
Things were so bad yesterday that for a while one-year treasury bonds were selling at below zero. That means people were so frightened about where to put their money they were, effectively, paying the U.S. Government to hold it for them.
Remember in the deep dark days of last Friday when we were assured interest rates were going to skyrocket and those higher rates were going to be a "tax on all Americans?" If interest rates for Treasuries go below zero, do we all get a tax refund?
To put that 512 point drop in perspective, let's step into the Wayback Machine and go to September 15, 2008.
That was the Monday after the weekend collapse of Lehman Brothers and Merrill Lynch. We were told our ATMs were in danger of not working. The Down Jones average dropped only 504.48 points. Yesterday's collapse was bigger than that Monday in September, 2008 and our ATM cards appear to be in no danger.
To be fair, the trouble didn't end with the collapse of Lehman. On March 9, 2009 (the Obama Era having begun) the Down closed at 6,547.05, its recent low. Even with yesterday's loss the market is still 4,836 points higher than in the Spring of 2009.
Watch for that to be in a Democratic National Committee ad:
"Since President Obama inherited the dismal economy created by George W. Bush, the Down Jones Industrial Average has gained nearly 74 percent in value."
On inauguration day 2009, the DJIA stood at 8,279.63. So, Obama actually oversaw a loss of nearly 25 percent of the Down Jones value in just six weeks.
Because the DJIA is so high, a 512 point loss was only about 4.31%. The largest percentage loss of all time was on October 19, 1987 when the Down Jones lost 508 points, but because the average started the day at only 2,246 the percentage drop was -22.61%.
IF the Down had dropped by 22.61 percent yesterday it would have been a decline of 2,288 points.
Just to complete our history lesson, from the opening on October 28, 1929 (Black Monday) through the closing the next day, the Down lost more 23 percent of its value and launched what we oxymoronically continue to call the "Great Depression."
There are so-called circuit breakers in place to halt an out-of-control decline in the Down Jones averages but the first one doesn't kick in until there is a 10 percent decline (about 1,200 points). The second kicks in at 20% and the third (a total shutdown of the market for the day) at 30 percent.
Now that the Congress is gone for a month, the markets are free to worry about Italy, Portugal, Ireland, and Spain, among other countries. They can't pay their bills, their banks can't borrow money, and the European Central Bank is controlled by our old friends the Germans who want to stop bailing out their lazy, profligate brother EU nations.
By the time you read this, the July unemployment numbers will have been released by the Department of Labor. I have no idea what they will show, but I'm reasonably certain they won't result in calls to impose circuit breakers if the Down Jones Industrial Average rises too quickly.
The Recovery Summer of 2011 is not going to be any better than the Recovery Summer of 2010. Happy Birrrrthhhhdaaaay Mr. President …
TMZ "Reporters" Call Sarah Palin a "Bad Mom" and "Dumb" After Receiving Speeding Ticket | Cortney O'Brien
Exclusive Photos: Drug Mules Easily Smuggle Narcotics Into U.S. as Border Patrol Remains Overwhelmed | Katie Pavlich