COLUMNISTS Everyone became an expert on the deeper reaches of financial history last year. With almost any relationship on which market traders had come to rely in the past three decades breaking down, they had to delve deeper for precedents.
Early in the year, we were looking at the Long-Term Capital Management disaster of 1998 and the savings and loan scandal of the early 1990s. Once it became obvious that the new crisis was deeper than these and oil prices started to surge, comparisons with 1973 and 1974 grew fashionable. Now the oil price has dropped by more than $100 a barrel and we fear the first great deflation since the Depression, attention has turned to the 1930s. Some have disinterred long-forgotten incidents such as the panic of 1907 (which led to the creation of the Federal Reserve), or the panic of 1873, which followed a boom in investing in railroads.
