Black Monday Echoes as Computers Fail to Restore Confidence
By Nina Mehta, Rita Nazareth and Whitney Kisling
Oct 19, 2012
A quarter century after the worst one-day stock crash in history, measures to prevent a repeat are failing to keep investors from losing confidence in the market.
The 23 percent plunge in the Dow Jones Industrial Average (INDU) on Oct. 19, 1987, came amid signs of a slowing economy, the threat of higher taxes and concern among individuals that trading was rigged for insiders. Today’s investors have pulled $440 billion from U.S. equity mutual funds since 2008 and sent trading to the lowest levels in at least four years, retrenching after the worst financial crisis since the Great Depression and the May 2010 stock crash, data compiled by Bloomberg and the Investment Company Institute show.