As stock markets continue to tumble after the US imposition of sweeping and swingeing tariffs, many are asking does this qualify as a stock market “crash” and what that could mean for them.
The word crash has been used sparingly over the decades and is usually reserved for a fall of over 20% from a recent peak in a day, or over the course of a couple of days.
On 19 October, 1987 – also known as Black Monday – the US stock market lost 23% of its value in a single day, and other stock markets had similar falls. The UK FTSE index fell 23% over two days – partly because it closes earlier than New York, and so it often plays catch up with whatever happens in the US the next morning.
That was most definitely a crash.
In 1929, the US stock market lost over 20% of its value in two days – and 50% within three weeks. That was the famous Wall Street Crash that ushered in the great depression of the 1930s.
By comparison, the US stock market has…
