Black Monday — First Televised Market Crash
Impact
Dow −22.6% in single session
What happened
Portfolio insurance programs, designed to hedge institutional equity exposure, issued automatic sell orders as prices fell. Those sell orders pushed prices lower, triggering more sells. Meanwhile, cable news carried the crash live into living rooms for the first time in history. The feedback loop between falling prices, algorithmic selling, and televised fear compressed a typical multi-day panic into a single trading session.
Context
Program trading algorithms were set to automatically sell when markets fell to certain levels. TV coverage created a visible panic loop.
Era
03 · Cable TV & Bloomberg Terminal
CNBC launched 1989. Bloomberg terminals hit floors in 1982. Financial commentators could move markets in real-time. The era of the unchecked prediction began.
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Other events in this era
Later in era →
LTCM Collapse