How long markets have taken to recover

The Reserve Bank of Australia’s Statement on Monetary Policy (released 6th February 2009) included the following graph of the largest falls in Australian equities (aka shares). As the RBA note in their report “Historical experience indicates that, following large falls, it can take between three and six years for the share market to recoup losses”.

aust_equities-falls-rba.jpg

Read the full report on the RBA website here. The above graph is graph 65 on page 47 of the report.