Imagine for a moment you're a mortgage lender. Your business has been good for the past few years. Homes are selling like hotcakes, and the closing costs and other fees you take in on each home sale keep growing as the prices of the homes you're financing grow. You've heard the talk of a housing bubble - all that business about trees not growing to the sky and such - but you're not concerned because you're a conservative lender.

You only lend money to people with the best credit ratings. Nothing but low risk loans. The appraisals all check out. The value of the homes you're carrying easily offsets the mortgages you're writing on them. In fact, in 35 years of home pricing history, home prices have never fallen. You're virtually assured it won't be more than a few months before appraised values rise well above the mortgage loan amounts.

What a heart stopper, eh?

A 416 point drop in the Dow Jones, the biggest down day since 9/11... Is it the end of the world or just a one day aberration?

I wish I knew. Futures this morning are optimistic. We won't know for sure what will happen until the bell rings and real money starts changing hands.

The first thing I did when I heard the news was to have a look at what this extraordinary trading day meant in terms of recent market closes. Specifically I wanted to know just how extraordinary this event was in relation to what we've become accustomed to.

The attached chart illustrates what I'm talking about. Click it to see the full-sized view at the end of this article. The chart shows a rolling 30-day average price change and standard deviation for the ticker symbol DIA, commonly referred to as Diamonds. DIA is an Exchange Traded Fund created expressly for the purpose of tracking the performance of the Dow Jones Industrial Average. As the Dow 30 change, so does the price of DIA.