From the FT

Difficulties in identifying breed of bear markets

By John Authers Published: July 12 2008 03:00 | Last updated: July 12 2008 03:00

http://www.ft.com/cms/s/0/79a07a46-4fb5-11dd-b050-000077b07658.html?nclick_check=1

Published: July 12 2008 03:00 | Last updated: July 12 2008 03:00

Bears come in many species. Some are vast and vicious hunters, living off raw meat. Some eat fruit. And some, like koalas and pandas, are not bears at all.

World stocks are this weekend in a bear market. But bears come in as many varieties in the markets as they do in the wild.

I have not been able to find the origin of the widely accepted definition that a 20 per cent fall in an index equals a bear market.

But the "20 per cent fall" definition is not useful. By this criterion, world stocks suffered "bear markets" in October 1987, following the Black Monday crash, and in autumn 1998, following the meltdown of Long-Term Capital Management. Both were over within months, but neither has much in common with 2008.

There have been 30 bear markets, so defined, for the S&P 500 since 1900. According to Thomas Lee of JPMorgan, four of them troughed at 20 per cent down. A further 11 dropped only 10 per cent or less after the point at which they finally hit the 20 per cent barrier.

But nine of them still had more than a year to go before hitting rock bottom, and five would see further falls of 30 per cent or more....

..... follow link above to get the rest at FT well worth a read.

This is not advice! Always seek professional advice before investing