Probably. But the point is that Bitcoin itself is safe, no one lost BTC that they personally held. People lost BTC they held at MtGox - i.e. BTC that MtGox had full control over. And that's the point - I don't need to keep my BTC at an exchange, I can keep it quite safe myself. I suppose I could keep control of my cash, as well - but it'd occupy far too much space, and would be expensive to secure.

For my purposes Bitcoin is far safer - I keep possession and control of my BTC, and when I need to trade or make a purchase I can make an informed decision about counterparty risk (which is why I prefer OTC, and always use escrow).

Edit: Where did it spike above $1000? On Bitstamp it's been around $700 or lower since the start of February - http://bitcoincharts.com/charts/bitstampUSD#rg60ztgSza1gWMAzm1g20za2gWMAzm2g1920zl