I recently came across the following deep and interesting link on StockBee’s site, in reference to an article by Matthew Rees entitled “The Hunt for Black October.”

Author Rees discusses various perspectives from the events leading to the major 20% decline in the Dow Jones Average on “Black Monday,” October 19, 1987 and includes many lesser-known facts about that dismal day on Wall Street.

The article is an interesting read because some analysts muse that the current market resembles some of the characteristics that preceded that tumultuous fall, including comments by former Federal Reserve Chair Alan Greenspan (made September 6th, 2007 as reported at CBS News).

Is the Economy heading towards Recession and is the current environment like that of 1987? I weigh in on the side that says ‘no’ but I always encourage independent thinking and careful critical research on your own.

I highly recommend you read the article and learn from the author’s perspective, and learn his Seven Possible Reasons for why “Black Monday” occurred, and then analyze his “Best Explanation” as to why Rees thinks the events happened.

It is interesting to note that no major terrorist attack, no enormous disruption, and no major singular event was the cause of the market decline, but that it was almost a ‘Perfect Storm’ that was set in motion and culminated in eerie harmony, leading to the market’s cascade.

Think and see for yourself and try to draw possible parallels to the current market action and environment. Are we forming a current “Perfect Storm” that only begins with the “Credit Crunch” and Housing Market Decline?

Time will tell. Be safe!