Black Monday 1987

[Stormy Kromer]

I'm sure several forum members remember October 19, 1987, aka Black Monday.

I was 22 years old and had just invested my life's savings into two different mutual funds on Thursday, October 15th. $10,000 hard earned dollars were worth about $6,000 the next week. I didn't sell and actually kept buying as I could and stuck to it. It hurt, but calm heads won. The only saving grace for me was that the MN Twins won the World Series, something I thought I'd never get to see.

Just a friendly pointer to young investors on the forum, there are going to be corrections in your investment lifetime, take them in stride and stay the course. It really does work.

 

[bingybear]

I remember that time. On the friday before it I bought short term CD with Merrill Lynch.

 

[pjm-7]

I was working brokerage in a S&L. I sold a lot of government bonds to your typical S&L clients who really thought they were diversifying from CD' s. They were all in a panic that day. When I called them back to tell them they made money, they were surprised. For some it was the first time that they really understood what they owned.

 

[MRG]

I vividly remember. I was in the IT industry supporting systems that tracked fund ownership. We had a SR VP come by and tell us volumes would likely go through the roof.

He was right.They did. We knew those systems like family, they had unique behaviors. That day they behaved like mad Chucky dolls, acting out in new and unusual ways.

How do you run out of resources you had to pretend exist? Actually this was a very good day for me professionally. I was the lucky guy who found a bit turned on that shouldn't have been. Made everything start working again. Raises were excellent that year.

I had retirement money in the market thanks to Megacorp. Could not sell it so letting it ride was the only option and the right one.

 

[Senator]

I was a bartender, working a stock broker dinner. Out of ~35 people that were supposed to be in attendance, only three showed up.

I was in college and really did not have much invested.

 

[easysurfer]

I was just a young puppy a few years into my career and didn't know about investing at the time (nothing but savings and checking accounts for me).

I remember older co-workers in a panic talking to others. Some folks came up and asked me it I had any stocks and I said "Nope". They looked to me like I was a genius of some sort, when really I was just green .

 

[teejayevans]

I sold all my company stock to buy a Corvette the week before, sometimes it pays to be a spendthrift [emoji2]

 

[Fermion]

I was still in high school. I remember thinking on Black Monday in 1987 that Rachael who sat three seats in front of me in Physics was *really* hot.

 

[thumbs]

Thanks for posting that. I think the key is "for young investors", like you mentioned. You can weather quite a financial storm early in your investment career and still win the game. My wife and I bought a business in 2008 that were eventually closed while still owing money on it in 2014. We took no income out of it in those 6 years. Not a mistake I would like to make at 50+, that's for sure.

 

[calmloki]

Don't recall having a clue - we were starting to roll on the rentals. Had spent years fixing up a single rental house to absurd personal standards, then used it's equity to buy another rental house 4/1/85, a triplex in '86, and some nine unit apartments on 4/1/87. We were totally focused on trying to bring the places up to snuff and make our payments.

 

[Koogie]

I was still in high school. I remember thinking on Black Monday in 1987 that Rachael who sat three seats in front of me in Physics was *really* hot.

Ditto. Except it was History and her name was Sheri.

 

[NYEXPAT]

Thanks for the trip down "memory lane". I reached FI by 11 am that morning, retired the next day with a hangover and it has been 30 glorious years since.

 

[6miths]

Didn't have anything significant investments aside from some CDs (this was the 80s remember) and was a resident in surgery. The surgeons' lounge sure was a down place that week. Interestingly, the lesson I took away was probably that stocks come back if you just hang on because by the time I had significant money to invest it went largely into the markets.

 

[omni550]

Back then, I was an engineer being sexually harassed (think Harvey Weinstein) by the VP of Product Development. I had finally been able to transfer out of Product Development and thus avoid this lecher, for the most part.

I clearly recall the VP calling me several times that day as the market slid ever-downward, bemoaning his losses. All I could do was laugh (mostly silently) as I made some sarcastic comments to him.

I had very little in the market as I'd recently bought a condo.

omni

 

[Major Tom]

I was fresh out of college (23 years old) and have only vague recollections of it, as something that was apparently quite bad, which happened to other people. When I think of October 1987, my particularly vivid recollection was very carefully parallel parking the car in front of an office building on Lake Ave in Pasadena on the morning of Oct 1st. I had recently passed my driving test and was still taking pains to master my parking skills. I gingerly backed the car into the space, only to see the car behind me wobble a bit. Weird - I was pretty sure I hadn't hit it, but I was really green at this stuff and not too sure of my abilities. I decided to quickly put the car into forward and, as I looked at the car in front of me, saw that it was wobbling too. Then I glanced over at the office building and saw that all the windows were shaking too! In a second it hit me. My very first earthquake. How exciting. Much more exciting than a market crash!

I was 23 and brand new in the US, with a few hundred dollars of debt on a British credit card, and absolutely no savings or investments whatsoever. Stock market crashes were exceedingly dull, but earthquakes? Now those were fun

 

[Big_Hitter]

I'm sure several forum members remember October 19, 1987, aka Black Monday.

I was 22 years old and had just invested my life's savings into two different mutual funds on Thursday, October 15th. $10,000 hard earned dollars were worth about $6,000 the next week. I didn't sell and actually kept buying as I could and stuck to it. It hurt, but calm heads won. The only saving grace for me was that the MN Twins won the World Series, something I thought I'd never get to see.

Just a friendly pointer to young investors on the forum, there are going to be corrections in your investment lifetime, take them in stride and stay the course. It really does work.

remember it well. I was 23, working for the man and still paying off bar tabs so I wasn't affected

 

[Mdlerth]

Didn't lose a dime because I didn't have one

I was fully invested in a wife and kids. They paid off in more than money.

 

[Walt34]

I had just bought a house a year earlier after a divorce, my net worth was a negative number, and I was working midnights so slept through it.

 

[Stormy Kromer]

I remember a quote from Sam Walton, then the wealthiest man in the US. A reporter told him how much his Walmart stock had declined, right down to the dollar. Sam calmly replied "It doesn't matter to me, I'm not selling it".

 

[USGrant1962]

I remember we were on the second floor of our building and there was a news ticker machine in Public Relations downstairs. Folks would run down, check it, and come back upstairs and report all day as the market tumbled.

No internet or financial TV back then.

I was 25 with just a little money in the market. Back then there was a 3-year wait to join the 401(k). Which I guess worked out pretty well for me in the end, now that I think about it.

 

[jebmke]

I was fully invested. My then-fiance was a portfolio manager for a small cap money manager. Exciting times. We used to (partially) joke about staying off the sidewalks in the financial district to avoid being hit by a falling money manager.

The fact that it wasn't easy to do transactions back then - no real internet - made it a bit easier to just ride it out. It was a fairly short but severe event.

 

[lwp2017]

Good thing we couldn't check our portfolio balance online back then.

Out of ignorance I stayed in the market.

I was a new investor. Three years earlier my dad advised me to put 10% of my pretax salary every month into my 401K so I did, 100% into stocks ( wonderful advice!).

To me, it was a large amount invested ( about 1/3 of my annual income at the time), especially with young wife and a new baby.

 

[MRG]

I was fully invested. My then-fiance was a portfolio manager for a small cap money manager. Exciting times. We used to (partially) joke about staying off the sidewalks in the financial district to avoid being hit by a falling money manager.

The fact that it wasn't easy to do transactions back then - no real internet - made it a bit easier to just ride it out. It was a fairly short but severe event.

It wasn't too easy to trade, correct.

However the brokerages that love to churn their clients accounts, increasing fees, had a field day.

Imagine the poor folks who trusted ED and received a phone call about the market tanking. Many blindly followed bad advice.

 

[jazz4cash]

I remember stories of people trying to sell but couldn't get through to their brokers by phone. Some got through but brokers were unable to execute the orders esp for individual investors. It could have been a bigger drop. In the long run it was better to ride it out. I had a tiny brokerage account and a small 401k. I think we could only make changes to the 401k on the 15th and last day of the month.

 

[Brat]

I remember telling my friends that the market was too high and sold all our stock the Thursday before. A couple weeks later my Mother observed that Exxon was a bargain. Bought some. Stood pat until it comprised over half our investments (maybe 5 years) then sold and purchased Magellan.