(March 13 – 08:40 ET) – “The bear market in the Standard & Poor’s 500, the most widely followed broad index of large stocks, became official yesterday as the index ended the day down more than 20 percent from the peak reached last March — thus meeting the usual definition of a bear market,” writes Floyd Norris in today’s New York Times.

“But if the great bull market of the 1990’s is finally over, the bear market that has replaced it is so far a very unusual one because the damage to the stock market has been so concentrated.”

“The collapse of technology issues has affected the Nasdaq composite index far more than it has other indexes, and the Nasdaq composite is now down 61.9 percent from its peak. That is the largest loss any major American index has suffered since the Depression and has helped dampen consumer confidence and slow the economy. But many Americans continue to buy stocks.”

” ‘Despite the 60 percent collapse in Nasdaq, people still believe that stocks are the place to be,’ commented Robert Barbera, the chief economist of Hoenig & Company. ‘That is astounding, but no doubt it reflects the spectacular performance registered over the preceding five years and the very good performance all the way back to 1982.’ “

“Since the S.& P. index peaked, many more stocks within that index have risen than have declined. But the fall of the technology stocks has caused many mutual funds, including the popular S.& P. index funds, to lose money.”

” ‘The market’s rise was concentrated in technology, and the market’s destruction is concentrated there,’ said Byron Wien, a strategist at Morgan Stanley Dean Witter. ‘A lot of old-economy stocks have done very well.’ “

“The S.& P. 500, which fell 53.26 points, or 4.3 percent, to 1,180.16 yesterday, is now down 22.7 percent from the peak. It was the first 20 percent decline for that index since the 1987 stock market crash. And it is the first time the index has fallen below 1,200 since late 1998.”