Market Crash2

30 Years After the 1987 Stock Market Crash, We're Right Back Where We Started

By Shah Gilani, Capital Wave Strategist, Money Morning • Thursday, October 19, 2017

On Oct. 19, 1987, the Dow Jones Industrial Average plummeted 22%. That one-day drop, the largest in U.S. history, became known as Black Monday.

This year marks the 30th anniversary of the '87 crash. But despite the passing of the years, we're no safer from a huge drop in the stock markets than we were in 1987.

In fact, another crash isn't just possible, it's probable.

Once again, seemingly smart Wall Street products, pregnant with potential unintended consequences and combined with regulatory ignorance and complicity, practically guarantee it.

Here's what caused the crash in '87, and the chilling truth about the one thing that's different this time that will make the next crash even worse...

The 4-Week T-Bill Is Actually a Secret "Liquidity Hack"

Usually intermarket analysis is a big waste of time. Often, what correlates today won't correlate a year from now, or the correlation may even reverse. But there is an exception to the rule that intermarket analysis is useless... and it's the U.S. Treasury market. If you know what to look for, Treasuries - in particular, the 4-week T-Bill - can tell you something very important about liquidity and which direction the money is flowing. That, in turn, will ultimately tell you where the stock market is headed.

Here's how it works...

Oil

This New Oil Crisis Could Set the Middle East on Fire

Currently, situations in Latin America (Venezuela), Asia (the South China Sea crisis), and Africa (ongoing civil conflict in Libya and Nigeria) show how widespread geopolitical events can affect both energy prices and availability. But the instability in one region in particular remains the biggest single factor in how the two sectors interact: the Middle East. There, two significant events unfolded over the past week. Each is certain to have an impact on how crude oil trades in the near term.

And they could set the whole region on fire...