What is driving the stock market towards a 1987 like crash? - Alldamoney

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What is driving the stock market towards a 1987 like crash?

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Questions whether a stock market crash is inevitable can’t have a clear answer for now cause no one knows when it’s coming, however years after this, we might have a clearer  picture of why and how it did or did not.

Right now, stocks have only been more expensive than before the tech bubble and the 1929 market crash.
For now, stocks in the market remain attractive as its price-to-earnings are being supported by historically low level of interest rates on the relative market valuation basis.
So what will cause this crash if there will be any?

Quoting Warren Buffett fear might lead to any crash in the market and not the price of stocks.

Can fear like those of Oct. 19, 1987 happen again after Thirty years?
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Known as one of the worst days in stock market history Black Monday as it’s called around the world” In New Zealand and Australia the crash is referred to as "Black Tuesday” based on the time zone difference” is the day stock markets around the world crashed, shedding a huge value in a very short time.
The crash started in Hong Kong spreading around the world within a short time, first hitting west Europe, and then the United States where the Dow Jones Industrial Average (DJIA) fell exactly 508 points to 1,738.74 (22.61%) affecting other markets around the world.

Technically an exact repeat of that crash cannot happen as new rules and regulations in the stock market won’t allow a 22% daily drop in the Dow Jones Industrial Average.
However, this does not mean that panics have been eradicated from markets as Nobel Prizewinning economist Robert Shiller noted in the New York Times recently.

To make his point clear of how humans are yet to eradicate panics and surprises and the sorts of spiraling phenomena that create stock market crashes within our society, Shiller cited an untrue report of gunfire and the ensuing panic which broke out at the Los Angeles International Airport in July 2016 as an example.
He noted within his research on the’87 crash that, “a powerful feedback loop from human to human and not computer to computer set the market spinning.” It was not one bad earnings report, or one bad data point, or anything happening outside of the market itself, he said.

Therefore, while Regulatory and technological change has made Black Monday an impossibility, risk still exist as a market crash result from mass stampede set off through viral contagion.

Therefore, while markets have continued to show that they are fully capable of gripping participants in panics since after the 1987 crash. Yet this is true only in the narrowest sense: Our markets, of course, exist in this reality.

Alldamoney '

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