Saturday, December 26, 2009

What happens if the stock market numbers drop to zero?

The nasdaq is pretty close right now. What would happen/what does it mean? What happens if the stock market numbers drop to zero?
Even if the stock market falls 10% over the next 10 days it won't be zero, because for example:


Day 1, 100 - 10% = 90,


Day 2, 90-10% = 81,


Day 3, 81 -10% = 72.9,


It will never go to zero by falling 10% everyday, even if it goes on forever, at some point it would be close to zero, but never 0.





But it will never happen it is impossible, it is like asking: What is the odds that humans go back to the caves?





What happens if the stock market numbers drop to zero?
You're kidding right? if the Dow crosses 8,000 people will be jumping out of tall buildings.





But seriously, I don't think that's possible because so many people would buy it well before then. But, dropping to zero is saying all the companies are worthless. IF that happens NO ONE knows what would happen.





It's like saying what would happen if I flapped my arms and flew to the moon.
Even with today's huge drop, NASDAQ closed at 1983.73, hardly ';pretty close'; to zero.





For the indexes to go to zero, all the stocks in that index would have to become totally worthless, not likely to happen.
The NASDAQ index is hardly close to ';zero.';
That would be bad. Very very bad.
Thanks for the question. When I start hearing gloom and doom like this, it is time to buy. Be afraid, be very afraid!

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