“We will not have any more crashes in our time.”
— John Maynard Keynes (1926)
All last year a prominent ad ran in Yahoo Finance and elsewhere predicting an “80 Percent Collapse in Stocks.” A lot of Cassandras are wiping the egg off their faces, having predicted another stock market crash, economic depression or a dollar collapse.
None of those prognosticators are coming forward with a mea culpa. No doubt fear sells more than greed.
Today is the 30th anniversary of the stock market crash on Black Monday, October 19, 1987, the worst crash in Wall Street history — the Dow fell over 500 points, or 22.6%, equivalent to 5,000-point drop today. It may be a dim memory for most of you, but for me it was as vivid as yesterday. It happened to be my 40th birthday, and Huffington Post published, in my honor, an interview that contains a timeline of my accomplishments as well as economical insights from me. You can read the interview here. However, few of my friends on Wall Street were smiling at the party my wife put together that day. One broker friend had a $5 million margin call, and wasn’t sure if his customer was going to make it. (He eventually did.)
I was lucky enough to anticipate this “first-class catastrophe,” as one historian calls it. Six weeks before, I sent out a special alert to my Forecasts & Strategies subscribers with the headline, “Sell all stocks.” This morning, I was live with CNBC’s Rick Santelli to remember the stock market crash from 1987, you can watch the video here.