Earlier today I reposted a classic cartoon from the New Yorker (scroll down or use the Blog Search Box for cartoon) that graphically shows how bear markets can trick you. A real bear will keep teasing until it has sucked every dollar available from the buyers by appealing to the hope that "This is the bottom".
Credit Writedowns had a page of eight DJIA charts that give a stark portrayal of how relentless the '29-'32 down move was. From 381.17 to 41.22 in 33 months. Anyone who was fully invested on September 3, 1929 and rode the whole rollercoaster waited much of their adult life before the DJIA got back to 381 in 1954. I'll put the link to their homepage below the charts, click any chart to enlarge. And no I don't think we're in for an 89% decline. But it could be 40% from the 14,164 closing high last October. That's the same order of magnitude as the '73-'74 bear (although with inflation that was a 70%+ loss of buying power).
Dow 8500 is well within the realm of possibility. From today's 10,609 close that is a nasty prospect.