Morning Market Report

The Provocateur ^ | 10/19/2009 | Mike Volpe

[fiscon1]

Today is the 22nd anniversary of Black Monday in 1987 when the Dow lost 22%. While we've had a lot of volatility in the markets recently, I think everyone would be stunned if we had that kind of a day. All three indices were down on Friday and that followed a bad day on Thursday as well. Futures are pointing up modestly this morning. A lot of companies including Hasbro, Texas Instruments, Apple and Boston Scientific will announce earnings before, during, and after the market hours today. Also, Ben Bernanke will give a speech on the economy this morning and any time the Fed Chairman speaks the market listens.

[Daveinyork]

What a lot of people seem to forget about that 1987 crash is that the market had already lost about 20% of its value from January 1 to October 14 of 1987. The Dow went from about 2700 to about 2200 in that time period. What they would also like us to forget is that in 1987, The Dems regained control of the Senate, as a result of the 1986 elections, giving them total control of Congres for the first time since 1980, and several anti investment laws were passed that took effect in 1987, including new restrictions on IRA’s and other qualified retirement plans, and an increase in the capital gains tax that was included in the 1986 tax reform act, which was supposed to give us a flat tax.

On Thursday, October 15, the Dow lost another 100 points or about 5%, and on Friday, yet another 100 points disappeared, leading investors to panic helplessly over the weekend (before online trading). On Monday, terror-stricken investors swamped their brokers with sell orders.