Circuit breakers triggered four times in a week
The COVID shutdown produced the sharpest equity crash in history. The market-wide Level 1 circuit breaker (a 7 percent intraday decline) triggered four times inside ten trading days. Each halt paused trading for fifteen minutes. It was the 1988 architecture's largest real-world test, and it worked as designed.
The 2020 halts were the first time the full market-wide circuit-breaker system had fired since its design. The compressed cadence in March 2020 is widely cited as the moment the architecture paid for itself. The Fed's monetary response on top of the halts is what actually stopped the crash. Structural pauses plus liquidity, in that order.
04 · Circuit Breakers
Black Monday's 22.6% single-day drop exposed the fragility of fully-electronic, program-driven markets. The NYSE responded within a year — an unusually fast turnaround, precisely because the 1987 crash did not turn into a recession.
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