NARRATIVES: BLACK MONDAY

 Ah Monday; the toughest day of the week. Even with delusional motivation, placebos and weak resolutions, hardly any employee manages to make Monday less painful (This post was also written/typed on Monday). Ask about Mondays to any trader from the 80's and they'll probably reminisce about the most devastating Stock Market Crash of the 80's, commonly referred to as 'Black Monday'. In Australia and several other neighboring countries, it is known as Black Tuesday because of time zone difference.  

Black Monday was a severe downfall that happened in late October 1987. It originated in the US following major collapses in the markets worldwide. Those so-called Economists (actually bluffs) would correlate this event to any kind of phony reasons. However, it'd be a sheer waste of time trying to study, discuss or even write about the reasons for this event (Also, whatever you are about to read is not worthwhile. This is just a test for myself) 

In the US, the Dow Jones Industrial Average witnessed a staggering drop of 508 points (which was about 23% back then). That amounted to the world's largest percentage drop in one day. Following, the other major economies started to descend. Hong Kong and Singapore markets declined by 37%. Major Industrial Markets witnessed a sharp decline greater than 15%.  The consequences were said to even affect monetary policies, exports, banking systems and obviously foreign exchange. 

In the UK, the FTSE Index had fallen over 23% while the Japanese markets declined by 15%. Stock Exchanges started to actively regulate trade cycles and related activities.

It'd be foolish to discuss the causes of such events. Nobody actually knows what series of random events caused such a crisis. Many Economists and Statisticians provide you a bunch of detailed studies including lengthy texts, spurious diagrams and graphs and misleading terminologies. They have all fallen to what NN Taleb calls 'Monday morning quarterback heuristic' which means that events often seem predictable after they have happened. Black Monday seemed so obvious after it took place. This is all behavioral economics stuff (Not going into that in this post). 

You will find numerous graphs and analyses on the internet about this event. However, most of it is junk. Neither the graphs that I have attached to this post nor the part I have written about Black Monday, are important. As I mentioned, this is just a test for me. I want to know my competence.
The Introduction and the Conclusion are my own words. The part in between (about Black Monday and irrelevant graphs) is but a link between my words. Similarly, the outset and the end of any such adversely consequential events is what impacts the most. The rest is just a bridge between them and is composed of noise and news.

Writer - Yajnesh Gokhale 

Publisher - Soham Chinchalkar