The 1987 Crash

The first global financial crisis erupted in the autumn of 1987 on a day known as “Black Monday.” A chain reaction of market distress sent stock exchanges around the world plummeting in a matter of hours. In the United States, the Dow Jones Industrial Average dropped 22.6 percent in a single trading session, a loss that remains the largest one-day stock market decline in history. At the time, it marked the sharpest market downturn in the United States since the Great Depression.

In today's video we look at the causes of the 1987 crash, discuss program trading and portfolio insurance and how the crash forever changes stock markets around the world.

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[billschannel]

I was in high school on this day and my electronics teacher said he had money saved up to put in the market when it dropped. He was excited on the day of the crash and ended up putting it in the next day. This made a big impact on me.

[Dadsplain]

I'll never forget that the topic of my college economics class syllabus on the day of the 1987 crash was "The Stock Market Crash of 1929."

[franciscodanconia]

I was 12 at the time. I remember one of my friends dad’s panicked on Monday and sold off everything, losing a ton of money, money which he would have gotten most back by Friday. Taught me a valuable lesson about patience and investing on dips.

[tents]

Another exceptional look at market history by Mr. Boyle. I’ll never forget that day in 1987. I leaned about greed, fear, and irrationality, and those lessons have guided me ever since.

[bogrunberger]

I love this old 80's footage from the trading floor. Trading back then looks super intense!!!

[quincylarsonmusic]

I always heard the cause of this crash was just “computer systems that weren’t yet ready for prime time” but now I see it was a whole confluence of events. Thanks for putting this in a historical perspective. And a global perspective. I had no idea HK and NZ were hit even harder than we were here in the US.

[dannybucks]

Timestamps:
0:18 History of Black Monday
2:02 Evens leading up to the crash and why it happened
3:49 Lavaraged buyouts
4:27 The day before the crush
8:15 October 19th New York Stock Exchaned had opened
10:26 Fidelity system involvement in the market crash
15:58 Other explanations for the crash
20:54 Trading on a day after the crash
22:45 How the crash affected on other markets
26:01 What Traders and Risk Managers learned

[manolokonosko]

I wasn't even aware of the crash at the time. I was 22 and working as a test technician at an electronics firm. They laid off some engineers and other people I had no access or motive to connect with. I got to keep my job. Working as a "soldier"in the tech field, and not as a "manager" has been beneficial to me in the long run. Companies need soldiers more than they need "generals", and this is how I was not fired from any job - only laid off once in 1991 - in the past 40 years.

[SportsIncorporated]

I got stopped out of all my stocks on Black Monday 1987. What bothers me to this day is my stop limit orders weren't executed until each stock had reached its bottom. I got stopped out of Applied Materials. Which then went up 500 times. (Edit: Had I repurchased it, )All I had to do was wait 40 years.

[BasementBerean]

I was there as a very young professional. It started happening, as I remember, about ten minutes after market open. I actually got my IRA account out of the stock market completely before it started. My regular account rode it down. I have a picture of the crash on a Compaq 386 portable computer III.

[voidgeometry]

"Wisdom is never given, it must be asked for." Thank you for your knowledge.

[TheWolvesinthewoods]

My friend who worked on the floor of the NYSE lasted 3 years before he bought an organic farm selling lettuce and Cornish game hens.

[anthonyyoung]

That was one of the most beautiful days of my life. I will never forget it. I was 9 years old.

[Simon-jjpu]

I thought this was exasperated by the big 1987 storm in the UK which caused the insurance industry to go into panic due to the amount of claims coming in (at the end it was £2bn). The storm was 15-16 October 1987 with the first trading day, Black Monday

[Danieldfr]

I just gotta say your sense of style is immaculate👌🏾 thanks for the knowledge Patrick 👍🏾

[gagnepaingilly]

Don't fret, the debt ceiling always goes up. I wonder if 2008 crisis survivors had it easier. this could lead to economic downturns. We need to be prepared for potential market volatility. how can I secure my 250k portfolio against declining?

[jmm]

I was in high school and worked at Walmart back in 87. I remember the Walmart stock price board they had up by bathroom went from like 97 dollars to 20. I was new to stock prices but it left impression. Lol

[LadyLadyLadyOscar]

at 5:36 a young Robert Downey Jr. fuzzy and bewildered at the floor pit of the exchange

[Shannon_Vlogs]

I would love to see a 1929 version of this! Love your style!

[michaelsullivan]

I lived that. Things like that change your thinking permanently. Great video. You are one of my favorite youtubers.