Bear market
Meaning
A bear market is a period of sustained price declines in the stock market or other financial assets, often accompanied by widespread pessimism.
Origin
The vivid imagery behind "bear market" stems from the way a bear attacks its prey—by swiping its paws downward. This visceral action mirrors the downward spiral of prices in financial markets. The term itself gained traction in the 18th century, evolving from the slang surrounding "bear-skin jobbers." These early speculators would sell bear skins they didn't yet possess, betting that prices would drop before they had to purchase the skins to fulfill their obligations. This practice of profiting from falling prices cemented the "bear" as a symbol of pessimism and decline, eventually lending its name to an entire market condition where prices are continuously falling and investor confidence is low, a stark contrast to the aggressive upward charge of a "bull market."
Examples
- Investors are worried that the recent dip in prices could signal the start of a prolonged bear market.
- During a bear market, many people choose to sell their investments to prevent further losses.