I often hear on TV how the current market crisis is 1 in a 100 years…..
what’s the basis of this? Are they using historical market returns and seeing how many standard deviation away from the mean, etc.
Are they using Value at Risk to come to the conclusion? What are those analysts basing this on when they make such claims.
It seems somewhat odd to me when realisticly they only have like 150 years of historical returns at most. Not to mention the dynamic of the market has switched through time.