S&P 500 index analysis : the effects of the 2008 financial crisis

Abstract

The Standard and Poor 500 index is one of the most popular indexes in the world and its fluctuations have a lot to say about indices in general and about the international stock market. This paper will attempt to analyze the Standard and Poor 500 index in terms of its survival of the 2008 financial crisis, considering all the variables that are made publically available. Furthermore, this paper will use complex models as well as simple graphing to check the veracity of claims made about S&P around the time of the financial crisis. The purpose of this paper is to deduce where the S&P is headed. The 2008 financial crisis scandal had hurt the S&P in many ways and it had lost both credibility and face. However, in deciding whether or not the S&P is useful and profitable as an index, a colder, more objective approach is required. Furthermore, this paper will analyze the cause and effect of the precursors of the stock market crash to both show whether S&P could have prevented it and to prevent it from happening in the future. Hopefully, this paper will serve to clarify the situation as well as define the changes in the S&P over time and relate them to the changes in other stocks as well, such as the Dow Jones Industrial Standard.