On October 19, 1987, now referred to as Black Monday, the Dow Jones Industrial Average dropped a previously unimaginable 508 points. On that Monday,
$500 billion of paper wealth evaporated. For many, it inevitably brought to mind the collapse of the stock market in 19291 which preceded the Great Depression. The reaction of businessmen to the recent crisis, however, points to one of the many differences between these two historic events. "Unlike their predecessors in the 1920's, who did not think emergency Government measures could help, the .. .
businessmen of the 1980's are calling for Washington to intervene to stabilize the
markets." ' In addition, a Presidential task force studied the October crash and strongly recommended tougher governmental regulation of financial markets and the
establishment of one federal "superagency" to oversee intermarket issues.Today, increased regulation is seen by many as a panacea for the ills of the market.
The economic crisis of the 1920s and '30s led to intensive efforts by the federal government to regulate business, ending years of a laissez-faire policy.