Post by @JonErlichman
89% credible (93% factual, 80% presentation). The statistics on S&P 500 decline frequencies since 1928 are highly accurate and align with data from Investopedia and Macrotrends. However, the presentation omits the context of long-term market growth and recovery, resulting in selective framing that normalizes volatility without providing a complete historical perspective.
Analysis Summary
The post provides historical averages for the frequency of various percentage drops in the S&P 500 index since 1928, illustrating that market declines are a regular occurrence. These statistics are accurate based on long-term data, showing 1% drops happening 50-60 times annually while larger 25% drops occur every 5-7 years. However, it omits the context that the market has historically trended upward over time, with recoveries following most declines.
Original Content
The Facts
The provided statistics align with historical S&P 500 data from reliable sources like Investopedia and Macrotrends, which confirm average decline frequencies since 1928, though exact figures can vary slightly by calculation method (e.g., daily closes). Verdict: Highly Accurate – No significant contradictions found, but interpretations may differ on whether drops are measured daily or intra-day.
Benefit of the Doubt
The author advances an educational perspective on market volatility to reassure investors that declines are normal and predictable, drawing from historical data to promote a long-term investing mindset. It emphasizes the routine nature of small and moderate drops while omitting key context like the S&P 500's average annual return of about 10% since 1928 and the fact that bear markets are often followed by strong recoveries, which could shape reader perception toward downplaying risks without highlighting overall positive trends. This selective framing encourages resilience but may understate the emotional and economic impacts of larger declines, such as those during recessions.
How Is This Framed?
Biases, omissions, and misleading presentation techniques detected
The content selectively presents decline frequencies to normalize volatility but omits the S&P 500's long-term upward trend and typical recoveries, creating an incomplete picture that downplays overall market resilience.
Problematic phrases:
"How often does stock market decline?""1% drop: 50-60 times a year""25% drop: every 5-7 years"What's actually there:
S&P 500 has averaged ~10% annual returns since 1928, with most declines followed by recoveries and net positive growth
What's implied:
Declines are a dominant and frequent feature without balancing upward momentum
Impact: Leads readers to perceive markets as persistently risky, potentially discouraging investment by understating historical gains and recovery patterns
Fails to include counter-evidence of market recoveries and positive trends, which would temper the focus on declines and provide a more balanced educational view.
Problematic phrases:
"(S&P 500 avg since 1928)"What's actually there:
Bear markets (20%+ drops) have historically lasted ~14 months on average, followed by bull markets averaging 4.5 years with ~150% gains (per Ned Davis Research)
What's implied:
Declines occur regularly without mention of subsequent rebounds
Impact: Reinforces fear of losses by ignoring evidence of resilience, influencing readers toward short-term caution over long-term optimism
Sources & References
External sources consulted for this analysis
https://www.guggenheiminvestments.com/advisor-resources/interactive-tools/sp-500-historical-trends
https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp
https://fred.stlouisfed.org/series/SP500
https://en.wikipedia.org/wiki/Closing_milestones_of_the_S&P_500
https://www.macrotrends.net/2324/sp-500-historical-chart-data
https://www.usbank.com/investing/financial-perspectives/market-news/is-a-market-correction-coming.html
https://www.capitalgroup.com/individual/planning/market-fluctuations/past-market-declines.html
https://www.fool.com/investing/stock-market/indexes/sp-500/annual-returns/
https://www.fool.com/investing/2025/11/15/stock-market-last-seen-in-great-recession-decline/
https://www.bloomberg.com/news/articles/2024-07-24/s-p-500-snaps-longest-streak-without-a-2-decline-since-2007
https://www.fool.com/investing/2025/04/19/sp-500-12th-biggest-4-day-decline-75-years-history/
https://captrader.com/en/analysis/historisch-hohe-bewertung-im-sp-500-gerechtfertigt
https://investing.com/analysis/sp-500-correlation-breakdown-and-1966-analog-indicate-weakening-momentum-200670003
https://seekingalpha.com/instablog/605212-robert-allan-schwartz/4831186-annual-returns-of-s-and-p-500-from-1928-to-2015
https://x.com/JonErlichman/status/1237887576494792704
https://x.com/JonErlichman/status/1593637683846414336
https://x.com/JonErlichman/status/1242125166978772993
https://x.com/JonErlichman/status/1240059459646431238
https://x.com/JonErlichman/status/1536377890082029568
https://x.com/JonErlichman/status/1161765712072990721
https://en.wikipedia.org/wiki/Closing_milestones_of_the_S&P_500
https://www.macrotrends.net/2324/sp-500-historical-chart-data
https://en.wikipedia.org/wiki/List_of_largest_daily_changes_in_the_S&P_500_Index
https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp
https://www.hartfordfunds.com/practice-management/client-conversations/managing-volatility/top-10-stock-market-drops-recoveries.html
https://www.investing.com/indices/us-spx-500-historical-data
https://www.macrotrends.net/2526/sp-500-historical-annual-returns
https://www.cnbc.com/2022/06/13/sp-500-is-in-official-bear-market-according-to-sp-dow-jones-indices.html
https://tradethatswing.com/a-history-of-stock-market-percentage-declines-15-to-50-in-charts/
https://icfs.com/financial-knowledge-center/sp-500-weekly-drops-5
https://www.fool.com/investing/2025/07/26/sp-500-plunge-30-with-100-historical-success-rate/
https://xtb.com/int/market-analysis/news-and-research/us500-loses-1
https://investopedia.com/s-and-p-500-gains-and-losses-today-index-drops-as-investors-brace-for-tariffs-to-take-effect-11689978
https://sherwood.news/markets/last-time-s-and-p-500-dropped-more-than-2-was-512-days-ago/
https://x.com/JonErlichman/status/1593637683846414336
https://x.com/JonErlichman/status/1237887576494792704
https://x.com/JonErlichman/status/1240059459646431238
https://x.com/JonErlichman/status/1536377890082029568
https://x.com/JonErlichman/status/1242125166978772993
https://x.com/JonErlichman/status/1239649695108136961
Want to see @JonErlichman's track record?
View their credibility score and all analyzed statements