Joe Granville's Infamous Bear Call Came On This Day In Market History

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On Nov. 11, 1993, market forecaster Joe Granville predicted a 20% drop in the Dow Jones Industrial Average.

Where The Market Was: The Dow finished the day at 3,662.43. The S&P 500 traded at 462.64.

What Else Was Going On In The World? In 1993, U.S. President George H.W. Bush and Russian President Boris Yeltsin signed the Strategic Arms Reduction Treaty. Law enforcement seized the Branch Davidians complex in Waco, Texas. The average cost of a new house was $113,200.

Granville Misses The Mark: On Nov. 11, 1993, the Wall Street Journal published a survey of 10 market forecasters that included predictions of when the bull market would end. At that point, the bull market was 1,127 days old. Almost all of them predicted at least a 10% drop for the Dow by the middle of 1994.

One of the most aggressive bears at the time was financial writer and investment seminar speaker Granville, who is most known for developing the concept of on-balance volume. Granville told the WSJ the Dow would drop roughly 20% to around 2,900 by the spring of 1994.

Unfortunately for Granville, his prediction was totally wrong. Instead of dropping 20%, the Dow marched higher and was up another 3.7% to 3,800 by March 1994.

In fact, the bull market that began in October 1990 lasted just under nine and a half years, culminating with the dot-com bubble in 2000.