why this thing has blown out of proportions

Let's comare this crash to the 1973/74.

Very similar movements etc.

the reason this seems to be heading towards a great depression is TECHNOLOGY.

35 years ago there was no internet, no live market trading, no CNBC or Bloomberg on pay tv, no live feeds from the stock exchange etc, no internet trading, no mobile phones. To sell stock you had to call your broker and wait in line.

By the time the DOW dropped it was on the path of a recovery the next day by the time the people heard about it.

Nowadays we are watching the dow one tick at a time. If it drops we get onto out laptop and sell while watching the live charts and cnbc commentators. Bad news is personified into much larger proportions as the art of chinese whispers takes place and people panic and sell without listening to fundamentals.

With the live feeds nowadays we get one commentator on CNBC say insurance companies are being hit hard with the financial crisis and the dow drops 400 points. this didn't happen in 1973 or 1929