Black Monday 1987
About Black Monday 1987
The largest one day percentage decline in stock market history. On October 19, 1987, the Dow Jones fell 22.6 percent, losing 500 billion in value. The crash affected markets worldwide. Portfolio insurance and computerized trading programs amplified the selling. Unlike the 1929 crash, the economy did not enter a depression. Federal Reserve Chairman Alan Greenspan provided liquidity and the market recovered within two years. The crash led to the implementation of circuit breakers to halt trading during extreme declines. The exact cause remains debated, but market mechanics and herd behavior were major factors.
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