14

The world of finance has always been creative in using metaphors to describe financial phenomena. Specifically I am referring to a situation where financial market suffers a consistent fall and traders attempt to detect when prices are at their lowest and then buy stocks hoping for a bargain.

  • in the early 90's this false recovery signal was referred to as the Baghdad bounce after the rise in popularity that both George Bush and Tony Blair enjoyed following the fall of Baghdad in the Iraqi War. That popularity waned somewhat later when it became clear that pulling allied troops out of Iraq was likely to take longer than the public had first anticipated, (The Phrase a Finder)

a few years later it was substituted by the now more popular: dead-cat bounce to indicate a temporary recovery in stock prices after a steep fall which may wrongly and dangerously be taken for a real recovery of a positive trend.

  • Despite its obvious US origins, its first recorded appearance is in a report from the Far East in the issue of the Financial Times of London for 7 December 1985. It turned up again the following year in a piece written by a staff reporter on the Associated Press that spells out its origins and which has been widely quoted since:

    • One of the most vivid, if a bit indelicate, word pictures painted by the bears on oil comes from Raymond F. DeVoe Jr. at the investment firm of Legg Mason Wood Walker. DeVoe suggests the printing of a bumper sticker reading: “Beware the Dead Cat Bounce. “This applies to stocks or commodities that have gone into free-fall descent and then rallied briefly,” he says. “If you threw a dead cat off a 50-story building, it might bounce when it hit the sidewalk. But don’t confuse that bounce with renewed life. It is still a dead cat.”
  • The phrase gradually caught on during the 1990s but became very common during the financial downturn after 2000. Usage slackened off somewhat for a few years but the expression was revived during the world financial turmoil of 2008 onwards. (World Wide Words)

Ngram: dead-cat bounce.

My questions:

1) While the Baghdad bounce has a clear origin, I don't see where the reference to a dead cat comes from. It is an old tale or metaphor which was rehabilitated for the Stock Markets frequent falls or is it just an invention of an imaginative journalist?

2) Is the expression dead-cat bounce used only in a financial context or has it entered everyday idiomatic language for different situations?

  • 3
    Back in the early 80s there were a lot of sick "dead baby" jokes doing the rounds (they're easier than bowling balls to unload off a truck because you can use a pitchfork, etc.). My guess is the financiers were too squeamish to talk about a "dead baby bounce", so they just toned the meme down a bit. – FumbleFingers May 11 '15 at 15:42
  • 1
    @FumbleFingers: I think you may have got it! The first I heard of the dead cat bounce, it wasn't an adjective; it was in the analogy "even a dead cat will bounce". I suspect that this saying started out as "even a dead baby will bounce", and turned into cats even before it became an adjective. – Peter Shor May 11 '15 at 19:38
  • 2
    @Josh61 Here's a fairly definitive (from a noted scholar of jokes and similar folklore) cite of "dead baby" jokes as a fad starting in the 1960s in the USA: jstor.org/discover/10.2307/… – dodgethesteamroller May 11 '15 at 19:58
  • 3
    Dead cats were similarly present in jokes at that time as well. "101 uses for a dead cat" is a humor book first published in 1981. – BowlOfRed May 11 '15 at 21:09
  • 1
    @Josh61: My cat trained under the master (Schrödinger's cat, obviously! :). Like all cats, she was born capable of sleeping for 23h 59m a day, but thanks to the rigorous training she's now pushed that up to over 24 hours sleep per day. Which does mean I have to take the inert body down to the vet every so often to check if she's still alive, but I like to think it's good for both me and the cat to feel we're at the cutting edge of modern theoretical physics! :) – FumbleFingers May 12 '15 at 14:33
5

...or is it just an invention of an imaginative journalist?

The 1985 reference to a "dead cat bounce" was a quote from a broker in the Far East, the journalist did not invent it.

A 1991 New York Times article, ABOUT LANGUAGE; Double Dip or Dead-Cat Bounce? explores the origins of the term.

The old slang sense of excess [of double dip] has been shunted aside by the new sense of "two downturns."

A more graphic synonym for that worrisome news is dead-cat bounce . I first heard that phrase in July from Laurence Tisch, the CBS chairman, who told me over a power breakfast at the Regency Hotel in New York that this vivid description of a fearsome scenario was being bruited about in the nation's boardrooms. I opened a file; about that time, The Vancouver Sun in British Columbia reported: "Is the recession really over, or is it a ' dead-cat bounce '? The latter, we're told, is the market jargon for a false sign of recovery -- gruesome, but graphic."

Gruesome is right. The feline metaphor, surely distressing to animal lovers, was first used by a departing member of Franklin D. Roosevelt's Administration, Hugh Johnson of the National Recovery Administration, who described his exit as being amidst "a hail of dead cats," by which he meant widespread criticism. Dr. Seuss, when a political cartoonist for the newspaper PM in the 1940's, used cats with X-marks for eyes as symbols of denunciations of politicians.

The earliest citation I have is dead cat bounce , unhyphenated, although the first two words should be hyphenated as a compound adjective modifying bounce . On Dec. 7, 1985, Chris Sherwell in Singapore and Wong Sulong in Kuala Lumpur reported in The Financial Times that investment analysts "said the rise was partly technical and cautioned against concluding that the recent falls in the market were at an end. 'This is what we call a dead cat bounce ,' one broker said flatly."
New York Times

Edit:

Regarding your 2nd question, after some searching I found a blog entry by Barry Popik with very complete discussion of the term dead cat bounce which includes a lot of the information already discussed here and in addition he indicates

It has also been used in reference to political polling numbers.
The Big Apple

A quick search confirmed this

Bounces are normal but not universal. In all 12 cases, the GOP nominee got a bounce, and the same was true in nine of 12 conventions for the Democratic candidate. Why not all 12? Lyndon Johnson’s polling had already peaked in his landslide year of 1964, so it was hard for him to boost his soaring numbers. George McGovern’s disastrous convention in 1972, when internal disputes pushed his acceptance address into the wee hours on the East Coast, netted him a dead cat bounce. In 2004, John Kerry didn’t budge, at least in the Gallup Poll, from 47% — right around his proportion of the vote in November (48%). Kerry had a high floor, due to opposition to George W. Bush, and a low ceiling as well, owing to Bush’s strong base backing.
U.Va. Center for Politics: The Conventions: How Big a Bounce? Larry J. Sabato, Kyle Kondik and Geoffrey Skelley

In this cracked.com blog author Chris Bucholz points out the versatility of the phrase:

And if you don't find it too disgusting, there's no reason not to apply the same thinking to anything that displays a late, probably doomed comeback. Your battered football team scores a third-quarter touchdown and is now down by only 16? Dead cat bounce. A fading celebrity stars in a low-budget indie movie that isn't terrible? Dead cat bounce. Your patching up a misguided relationship with someone who's clearly wrong for you? Dead cat bounce.
cracked.com: 5 Expert Phrases That Explain Ideas You Should Understand

  • 1
    +1 . Correct, one broker said flatly suggesting an earlier usage of the expression. The metaphor of the dead cat has earlier roots and probably a different reference from the nine lives legend. Very interesting piece!!! Any idea on the current usage of the expression outside financial contexts? – user66974 May 11 '15 at 19:03
  • 1
    The idea of throwing dead cats (along with tomatoes and other debris) is unconnected with "dead-cat bounce", which comes from a financial aphorism, "Even a dead cat will bounce if you drop it from high enough", which referred to any slight and temporary recovery after a long decline. – Malvolio May 11 '15 at 19:52
  • I don't understand the relevance of "double-dip"? Am I missing something here? Maybe that paragraph should be deleted. – Mari-Lou A May 11 '15 at 20:39
  • @Mari-LouA Thanks for the comment, I can see what you mean. To correct it I decided to leave only the concluding sentence which is a segue to the first sentence of the next paragraph. – amdn May 11 '15 at 20:51
1

First of all, the financial world likes to use animal metaphors like bear, bull, stag, duck, pig, ostrich, lobster, sheep, dog and now cat. Welcome to the stock market jungle! The wolf is on its way from the Wall Street.

As for the metaphor, dead-cat bounce seems like associated with the myth that cats have nine lives. If you throw a dead cat off a tall building, it will bounce like other things; but one might think that it came back to life.

It is also mentioned in the book How the Stock Market Works: A Beginner's Guide to Investment by Michael Becket (2014):

enter image description here

Note: There is a reference to the cat having nine lives regarding the metaphor in the book An Investment Primer For New Investors: A Step-by-Step Guide to Investment Success by Perry L. Angle.

I think the phrase is almost only used in financial contexts currently but it has a potential that it might gain usage in other contexts. OED includes in the definition that:

(also, in extended use) a brief improvement, a spurious success.

And lists the following example from Washington Post (2001):

This is what is known as a ‘dead cat bounce’... If you throw a dead cat against a wall at a high rate of speed, it will bounce—but it is still dead. Likewise, if you debut ‘Inside Schwartz’ out of the enormous ‘Friends’ debut audience, ‘Schwartz’ will do a big number—but with only about 70 percent lead-in retention, it is still a dead show.


Here is a bonus diagram to better understand the metaphor:

enter image description here
Image Source: michaelcovel.com

  • Even a dead cat... You know what year is the citation from? – user66974 May 11 '15 at 18:00
  • @Josh61:2014 – ermanen May 11 '15 at 18:03
  • Ok, so it is the usual interpretation given to this saying. Thanks :) – user66974 May 11 '15 at 18:05
1

Origin of the phrase

Christine Ammer, The American Heritage Dictionary of Idioms, second edition (2013) has this entry for "dead cat bounce":

dead cat bounce A surprisingly quick but short-lived recovery from adversity. The term originated in the 1980s and referred to a suddenly improved price in a stock that lasted only until speculators quickly resold it at a higher price. It alludes to throwing a dead cat against a wall, from which it will bounce but remain dead. The term has been extended to similar phenomena, as in The home team has won the last two games, but don't count on more victories; that was a dead cat bounce.

That "dead cat" is not a traditional turn of phrase in U.S. slang (at least) is clear from the lack of any entry for it in J.E. Lighter, The Random House Historical Dictionary of American Slang (1994), which does have entries for "dead dog," "dead duck," "dead fish," "dead horse," "dead pigeon," "dead rabbit," and "dead turkey." The omission of "dead cat [bounce]" suggests not only that there was no historical resonance in the choice of a bouncing cat, but also that the expression "dead-cat bounce" was not yet widely used in the United States almost ten years after the term first occurred in the [London] Financial Times in the context of stock prices.

As for the proverb "Even a dead cat will bounce," it appears in Charles Doyle, Wolfgang Mider & Fred Shapiro, The [Yale] Dictionary of Modern Proverbs (2012), but with a first occurrence date of 1987:

Even a dead cat will bounce.

1987 "Shrinking Profit Margins Increase Risk of Aerospace Investments," Aviation Week & Space Technology 127, no. 9 (31 Aug.) 64: "If dropped far enough, even a dead cat will bounce,' one aerospace analyst aid about the recent firmness in aerospace stock prices." 1990 The Advertiser {Adelaide, Australia} 8 Apr.: "One analyst said the short-lived recovery was nothing more than a technical recovery or 'dead cat bounce.' 'Even a falling dead cat will bounce, but not fr and not for long,' he said." Possibly the proverb was the basis of the financial term "dead cat bounce," even though the noun phrase appeared earlier in a column by Chris Sherwell and Wong Sulong, "Singapore Stock Market Stages a Modest Recovery," in the Financial Times {London} 7 Dec. 1985: "Despite the evidence of buying interest yesterday, they said the rise was partly technical and cautioned against concluding that the recent falls in the market were at an end. 'That is what we call a "dead cat bounce,"' one broker said flatly."

Clay Naff, About Face: How I Stumbled onto Japan's Social Revolution (1994) treats "dead cat bounce" as a term of art in stock analysis, with a direct tie-in to the proverb:

A "dead-cat bounce" is a false recovery in stock prices, brought on by technical buying after a rapid drop in prices. "Even a dead cat will bounce if you drop him from high enough," explained a gleeful young trader. The trick, she explained, is to make your money on the fall, not the bounce.

So it appears that the expression is native to the financial markets, whether it first arose in the form of a simple metaphor ("dead cat bounce") or a longer proverbial expression ("even a dead cat will bounce").


Use of the phrase in nonfinancial settings

A Google Books search turns up several instances where "dead cat bounce" appears in settings that have nothing to do with stock prices.From Tom Robbins, Fierce Invalids Home From Hot Climates (2000):

In all honesty, he had to admit that the mission forced upon him by his crafty grandmother was a good deal less boring, potentially, than the mickey mouse assignment he'd been handed by Langley. Which was not to say it would be anything beyond an inconvenience, but it had the virtue, at least, of being an out-of-the-ordinary inconvenience, a kind of dead-cat bounce. A couple of extra days in South America wasn't exactly going to poison all the tadpoles in his drainage ditch. He would endure.

From Frank Scoblete, Get the Edge at Craps (2002):

After I release the dice, they travel side-by-side and go through identical motions. They land together, hitting the table flat or on edge, still turning over together in a similar parabolic trajectory, and possibly hitting the table a second time. They take what I call a "dead cat bounce" up just grazing the rubber pyramids slightly and coming down to rest. During the delivery, it looks as though only one die was thrown along the length of a mirror, and the second die is just its reflection.

From James Hawkins, No Cherubs for Melanie: An Inspector Bliss Mystery (2002):

Nursing his hugely swollen leg, Detective Inspector Bliss of the Metropolitan Police sat in the dark, damp pit waiting for Armageddon and wondering what had happened to his life. "At my age I thought I would have everything sorted," he mused, speculating on the speed his life had free-fallen since Sarah had let go. And, although Margaret hadn't exactly picked him up, she had certainly given him cause to rebound. Some rebound, he thought, surveying his gloomy circumstances. I suppose they would call this a dead-cat bounce, he thought, wondering who "they" might be. He also wondered how his old cat was faring without him[.]

From Philip Jolowicz, Walls of Silence: A Novel (2002):

"No e-mails to speak of,” Paula declared, as I bounced into my office at around noon. The bounce was a manifestation of the irrational optimism that I would need to get through the day.

It was a dead cat bounce.

From Gary Bouma, "The Emerging Role of Religion in Public Policy in the Asia Pacific," in, Regional Security in the Asia Pacific: 9/11 and After (2004):

Is religion one of the core elements differentiating the civilizations of the globe and fuelling their conflict as predicted by Huntington (1993)? Is religious diversity a threat to the integrity of the postmodern nation-state? Or is religion just enjoying a 'dead cat bounce' on the way to oblivion (Hervieu-Leger 2000; Davie 2002)?(Hervieu-Lé ger 2000; Davie 2002)? Each of these basic images of the current state of religion inform public policies about the management of religious diversity.

From Jason Burke, The 9/11 Wars (2012):

For one British security official, the spate of attacks in 2007 and 2008 and the GSPC's alliance with al-Qaeda was the 'dead cat bounce' of Algerian militancy. The comment may have been premature—cats have nine lives after all — but was not entirely unjustified.

These examples confirm Christine Ammer's view (quoted at the start of this answer) that "the term has been extended [from a specific situation in financial markets] to similar phenomena.

  • The omission of "dead cat [bounce]" suggests not only that there was no historical resonance in the choice of a bouncing cat, but also that the expression ' dead-cat bounce.'was not yet widely used in the United States almost ten years after the term first occurred in the [London] Financial Times in the context of stock prices. I think this is a crucial point. You see any possible relationship between the expression and Simon Bond's 101 Uses of a Dead Cat? – user66974 May 12 '15 at 6:01
  • @Josh61: Well, 101 Uses came out in 1981, which puts it a few years in front of the first known occurrence of "dead cat bounce." But a post hoc, ergo propter hoc argument about the connection between the two isn't especially compelling, in my opinion. The situation would be different if Bond's book (which I haven't read) included a suggestion to use a dead cat as a realistic representation of the price trajectory of a failing company's stock. It seems much more likely that the closeness in origin date and publication date is purely coincidental. – Sven Yargs May 12 '15 at 6:24
-1

I think it is used similar to "even a broken clock is right twice a day." The expression is amusing. A dead cat might appear alive upon bouncing after a sudden fall. No known origin.

Another expression for this financial trading phenomenon is "head fake rally."

EDIT ----------

The people saying this assume they are correct and are boasting because they just lost money (on the asset just moving against their prediction). Since a cat is so difficult to harm, as in 7 lives, they want to boast further by indicating that they have killed the difficult to kill creature, the cat.

  • Yes, but the clock is a specific device to measure time. But a cat? What does it refer to? Why not any other possible dead body? – user66974 May 11 '15 at 15:02
  • I think because many people find cats just insignificant enough to laugh at their peril, yet cats have a canny ability to escape serious bodily injury. – Ron Royston May 11 '15 at 15:08
  • Please cite the source and add the link that refer to your edit. – user66974 May 11 '15 at 15:23
  • @Josh61 Why not any other dead body? Perhaps because cats are known for being able to jump from impressive heights, landing deftly on their feet and remaining alive. There is just something inherently ‘bouncy’ about cats. And dead-halibut bounce just sounds silly. – Janus Bahs Jacquet May 11 '15 at 16:06
  • A dead-dog bounce would be considered indelicate and offensive by most people, whereas a dead-cat... who cares? – amdn May 11 '15 at 17:38
-2

The dead-cat bounce is defined as below:-

A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce is a small, short-lived recovery in the price of a declining security, such as a stock.

You can read more about this on investopedia

Origin :- The earliest use of the phrase dates from 1985 when the Singaporean and Malaysian stock markets bounced back after a hard fall during the recession of that year. Journalists Horace Brag and Wong Sulong of the Financial Times were reported as saying the market rise was a "dead cat bounce". -- Wikipedia.

  • Thanks, but this is not what I am asking, please reread my questions. – user66974 May 11 '15 at 15:05

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy