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The Nasdaq crash of April 2000: Yet another example of log-periodicity in a speculative bubble ending in a crash

The European Physical Journal B - Condensed Matter and Complex Systems Aims and scope Submit manuscript

Abstract:

The Nasdaq Composite fell another % on Friday the 14'th of April 2000 signaling the end of a remarkable speculative high-tech bubble starting in spring 1997. The closing of the Nasdaq Composite at 3321 corresponds to a total loss of over 35% since its all-time high of 5133 on the 10'th of March 2000. Similarities to the speculative bubble preceding the infamous crash of October 1929 are quite striking: the belief in what was coined a “New Economy” both in 1929 and presently made share-prices of companies with three digits price-earning ratios soar. Furthermore, we show that the largest draw downs of the Nasdaq are outliers with a confidence level better than 99% and that these two speculative bubbles, as well as others, both nicely fit into the quantitative framework proposed by the authors in a series of recent papers.

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Received 3 May 2000

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Johansen, A., Sornette, D. The Nasdaq crash of April 2000: Yet another example of log-periodicity in a speculative bubble ending in a crash. Eur. Phys. J. B 17, 319–328 (2000). https://doi.org/10.1007/s100510070147

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  • DOI: https://doi.org/10.1007/s100510070147

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