Fiction logo

The Stock Market Crash 1987

by Lee Roby 11 months ago in Short Story
Report Story

October 19,1987

The Crash of 1987

The collapse of the stock market had ruined many fortunes. It was 1987 and the Federal Reserve had tried to pump money into the banks. Alan Greenspan had clenched his teeth and went on the air. It was going to be a gloom and doom scenario. He wasn't going to talk about the Japanese. He wasn't going to talk about how they had fucked our economy. He was just going to put on his economic hat and tell the public that everything was going to be alright. He was the consoling mother who held her baby tight and told him that everything's going to be okay. But it wasn't. It was a fucking nightmare. The savings and loan crisis of 1972 had the same effect on a hard driven economy. It was Black Monday and this fucking nightmare was real. It was October 19, 1987.

My name is Steven Randall. I'm the one behind the scenes in 1987. I'm the one no one talked about. It was my speech to the Federal Reserve that no one wanted to hear. It was my speech that Alan Greenspan didn't want to hear. My prediction of the 1987 stock market crash wasn't on the news. I had been a senior partner at Wilshire, Gallo, and Randall. I had a degree in business law, and one in economic theory from Princeton University.

The reason I'm telling my story is threefold. First the stock market crash was something inevitable a sort of tsunami that broke all at once. I was the only one at the time who predicted it, but it was my theory of the Japanese and the 1986 tax credit that no one understood.

Second the stock market was riding high with temperaments of a boom economy and no one wanted to hear that an economic bubble was in the future.

Third it was the touting of stock and windlass forecasts that had the NYSE and many other markets flying high. My verbal judo just wasn't the thing that people wanted to hear. They just wanted to cash in their 401K's for a ride into blind profits and ride the wave to riches the stock market had promised them.

"Steven we've got a problem, look at the fucking screen. We're in deep fucking shit!" That was my senior analyst at Goldman and Sachs. He had called me and said that my predictions were right and that the senior VP had been wrong. The VP at Goldman had went on the air and told the public that we're in the greatest wave in the world and it was time to fucking cash in.

Brian had told me for some time now that the books and the share prices weren't adding up, and that there was trouble ahead. He had been the only one who believed the same thing that I did. We talked for over an hour. Brian I said, I'll talk to you tomorrow but now I've got to run.

My wife Jessica had been sleeping, and our daughter Rebecca had just climbed up on our bed and said, "Why do you have to leave so early, daddy." I'm sorry sweetie but daddy has important work to do.

Jessica gave me a kiss and told me to have a good day; but she could tell that there was tension in the air and that something was wrong.

"Steven there's a reporter on the phone," My secretary of 25 years said it's urgent," I told her I'll take it in my office. Hold all my calls later.

Her name was Ellen and she talked in a saucy tone and asked me why I hadn't gone public with my theories. She asked me why I hadn't challenged the status quo. I told her that I didn't have time to be in the press. She had read my book on game theory that Nash had published. She wanted to know why I had emphasized Nash variables so much, and why I hadn't published my theories. She said it was time to go public with what I had told the Federal Reserve.

My theories were known they just hadn't been on TV. The collapse was on every news station in the world. No one knew why the stock market had crashed. It wasn't the hype that our firm had wanted.

I told Ellen I had to go. Fucking H Christ I said. How in the fuck did she know what I told the Federal Reserve? How in the fucking fuck? I told myself as Katie brought me the Wall Street Journal. It had been on the front page. Stock market crash of 1987. Katie gave me my coffee and I told her not to bother me the rest of the day.

It was my forecasts to the Federal Reserve that were private, but if I were to expose the rampant problems that we're going on in the Federal Reserve, the stock market and Washington I'd be excommunicated. I talked to one of my close friends in the Federal Reserve; he had stated that it was Washington and the Gramm Bliley Act along with the 1986 credit act that had put the economy in a tailspin. It was the ability of a company to go public gain a lot of money; steal the earnings and then go bankrupt. It was this theme that went on over and over again. It was the people at Washington who had a blind eye to the forecast. He told me that Greenspan and his allies were right on track, and it wasn't there fault. It was also the loophole in the stock market that gave foreign investors the right to pull out stock if the economy was going bad. It was the Japanese who had the 10 largest banks in the world. It was my forecast of the Japanese that no one understood. They had the largest banks and with it could buy anything they wanted and with it foreign U.S. Companies that looked very good to their pocketbook.

We couldn't change the law? I had known that the Japanese were worried that day. The day of gloom. They had panicked though, and taken out all there money and destroyed the market. Alan Greenspan had pushed the oh shit button, and everyone had hit the floor. He called the banks and told them to start flooding the banks with money. He didn't know the Japanese were going to pull out, and told everyone we'll be fine just keep flooding the banks with money. It was all he could do. It was fucking over. The Japanese had just fucked us he said.

It was a sober moment. It was a cruel day in hell. The market had failed. The harrowing day had put reality into fruition. God Damn It. It was over, the bubble had burst and with it fortunes wiped out.

All I could do was think of John Von Neumann and his tome. It was 1600 pages long and he had written it on game theory. The Nash variables were going through my head at lightning speed. It was Nash's variables that told us that this shouldn't have happened. It was the market forces that had told us not to worry. It was the variables that didn't add up. The theory was right it just wasn't the players who could be accounted for. It was my last year at law school that kept me wondering why nobody had thought to keep foreign investors from pulling out their money in the first place. It was the Japanese who had inadvertently crashed the market with boom scenarios. It was why I had agreed to meet with Ellen and why I had written my book. It wasn't supposed to happen this way.

My mind was fucked up and I had called Jessica just to tell her I wouldn't be home tonight. I went to the bar and asked for a double scotch and hold the rocks. "What's up Steve," You don't come here unless you have something to complain about." Ted was my second best friend. He was my shrink, the bartender you could talk to. He had been there through the divorce. He had been there through every Mets season, and gone through the high's and low's. He had heard the spiel that Greenspan had said, and I wasn't the only one drinking themselves to death. "Is this shit gonna kill us; it's been a busy day and I've had to fight fires all day, they just can't believe it fucking happened. It's been 10 hours and people are fucking wasted over this shit." I didn't tell him about Ellen or the fact that the financial sector had just gotten their ass kicked. I just couldn't sit at the bar and feel sorry for myself. I had done everything I could. I had gone over and over what I told the Federal Reserve. I had published my theories; I had spoken about the Japanese. I had done whatever I could. Drunken and in a kind of stupor I left the bar and told Ted thanks and left a twenty for my troubles.

I didn't want to do it. I just was too fucking drunk to stay levelheaded. I told myself it could ruin my career. I told myself I had a happy home with my beautiful wife and daughter. I just couldn't fuck it all up, but for some fucking reason I just couldn't get the feeling from the back of my head. I took out my phone and I took her business card out, and cussed myself for twenty minutes. I called anyway. "Hey Ellen, it's Steve" I decided to meet with her. "I'll meet with you." "Don't tell a soul." She said "Fine, and I'm glad you called. You're a good person for doing this Steve."

I waived my hand, and a cab stopped and picked me up. Take me to Wilshire, Gallo, and Randall. I walked up the stairs went to my office and locked the door. I had a spare bottle of Glenlivet for times like this. It was supposed to be my celebration when I made partner, but I didn't care. I ripped open the bottle and took a healthy swig, and pounded my fist on my desk. It was half past 5 and people were leaving after rush hour.

I took out my book and looked at the Nash variables and thought the theory of games was a piece of shit, and that it didn't matter anyway, but I had forgotten what my mentor had taught me. It was my mentor who had drilled the ethos of conditional response on market variables that drove the market to real quality adjustments. Read the conditional response and adjust the variables to read data. I read the conditional response and I knew I was right. So why the fuck didn't anyone believe me at the Federal Reserve or at Washington. It was my beef with Washington that told me I was a hack and none of my theories were sound judgment. They said the doom and gloom reports of Randall had been a sight for sore eyes. It was Randall's predictions of the stock market that were insanely off touch with market principles. The sharks at Wall Street had plagued me with disdain and I was a no name on the street.

I took a long hard drink and told myself it was the only right thing I could do was to take Wall Street and take them down for what had happened last night, but it was the Japanese who had done it I said. It was the Japanese who collapsed the market. So I called my buddy in Japan and told him I was right. He was doing work with the Nikkei, and was doing business with the Japanese. It was the only thing they were talking about. He was as pissed as I was. Are you drunk Steve? He said. I didn't give a fuck this time. I told him I would get the Finance Ministry of Japan and tell them what I really thought. He told me to calm down and don't do anything stupid. I hung up the phone.

I debated for hours what I should do. I debated whether I should even talk to Ellen. I debated whether I should tell them what I had told the Federal Reserve. I couldn't think anymore. So I called Jessica and told her I was going to sleep at my office tonight and that I've got a lot of work to do. She told me not to worry and it's not your fault that the Stock Market had crashed. I took out my air mattress and pulled my blanket over my head and thought about what I should fucking do. I told myself it wasn't my fault and it was the fucks at Washington who had done this to me. It wasn't my ass on the line, but if I were to go public with what I knew I would get a backlash from Wall Street and every governmental agency in the country. I knew my career could be over, but it was my theories that held water and it was my prediction on the Street that had predicted the crash. No one wanted to hear it and point fingers. I knew Greenspan was in hell right now, and I knew it wasn't his fault, but he was to take the blame for what had happened. I knew Ellen would come by my office in the morning so I put the cap back on my bottle of Glenlivet and closed my eyes. I took some aspirin and fell into a deep sleep.

Katie my secretary woke me up with some coffee. "Late night." she said. You could say that I said. She brought me my paper and I told her not to take any of my calls. I had my cell phone on waiting for Ellen to call.

Ellen called and said she'd be at my office at 5 o'clock sharp. I told Katie not to tell anyone that a girl named Ellen was going to meet with me. "Cancel any meetings" I said.

Ellen came in at 5 sharp. We had closed the door. She asked me what I was going to say and if it was alright to record my answers. I told her not to record what I was going to say, but I told her I would tell her everything I knew. I went on about how I first got the job in the first place. Why a senior partner in business law and economics would be talking to the Federal Reserve. It was my book on economic game theory that had piqued the interest of Washington and the Federal Reserve. It was my theory on economics that had won them over. I had gotten my degree in business law, but thought that economics would be a great asset in the future. I had spent a lot of time on Wall street with my other senior partners and collected a lot of business with clients. My theories back then were the stepping stone for my later career with Washington. I had done a lot of work with big name firms in Washington and created a network. Greenspan was a sort of mentor for me back then and there was nobody that I respected more than Greenspan. It was my cool calm and my relenting theories on game theory and the market that got Greenspan thinking. He didn't really care about my credentials but liked the way I had presented an accurate look at Wall Street. He wasn't impressed with the hotshots on Wall Street touting stock and screaming for another bull market. It was their ineptitude that he hated and the brash undertone of sound economic theory that they had lacked. He didn't have a feel for the cocky Wall Street types and wondered why I wasn't like them, but that was why he had hired me in the first place. It was a harrowing task but I had told him I'd be glad to help. It was hard to read Alan at first. He had been such a genius in his way of economic forecasts and economic theory. To understand Greenspan you needed to know your economics. You needed to understand the street, and you needed to understand the man behind his way of economic theory. It was hard at first to understand the man who had capitulated economics to its highest point. It was my job to forecast the market with unrelenting peril and do it in a way that pleased Greenspan. I only met with the man five times a year and then I was to meet with his team every month.

Later Washington called and said they would need my help. I had worked with many of my clients. It was Washington that wanted me to change my forecasts in a way that made the market more reasonable to the public. It was my theories that had put the financial sector in a morbid state, and it was my way of doing things that needed to change. I did the best that I could, but I told them there was no way that I was going to change the way I was going to do things. I felt pressure from the financial sector and they had known my name from a few wealthy clients, and some who had been on the Bilderberg group. They had signed a confidentiality agreement and I was never to mention it to the public. The fat cats in Washington had wanted a middle man and that was me. They unlike Greenspan had wanted me to come and play on their side. They wanted me to play puppet master and I was their marionette. I just gave them the hard facts and if they didn't like it they could ruin me publicly, but at that time that was how Washington was run. The lobbyists and the powerful cadre in Washington had cow-towed to the financial sector and in their tone had scratched their backs in return. They knew who I was and they knew I could be manipulated in a way that brought fortune their way. I had held my ground and just stated the facts and left my theories on the wayside. I did my work and they were satisfied. Until I just started openly talking about my theories with the NYSE and how government had been run. I wasn't worried at the time and I just didn't even notice that I was doing anything wrong and went on doing what I had always done. I just went on working like I always did. Then something changed and I started to see something I hadn't seen before. I started to see how Wall Street had really worked. I started to see the underbelly of a government ethos hard at work. I started seeing the variables of a market economy going wrong. I started to see the miss managing of money and I started to see what some companies were doing. It was these market variables with my economic theory that had shown me a market not so nice anymore. I could see that the bull market was in a tailspin and the great economy we all thought was in deep trouble. It was my opinion that the market was going to fall by its wayside that people in Washington didn't like. It was my rampant disregard and lack of discretion that Washington didn't like.

I started my talks with Greenspan and he had agreed with what I was talking about. He had the same doubts and fears that I did. There was no way that he could go public with his information for fear that he could put the markets in deep jeopardy. He had wanted my opinion and he was glad that I had it.

Later on I had told her about the Japanese. I had some inside information of our dealings with the Japanese. Since I worked for Washington, the Federal Reserve and at Wilshire, Gallo, and Randall I had known our dealings with other countries. I had known that Greenspan had talked with the Bilderberg group and had attended their annual meeting.

It was 5'oclock p.m. and we had spent 12 hours talking so I told Ellen that we would have to meet some other time. She told me she wasn't going to the press and it wasn't the time to go public with any information. She told me she would print only what I wanted. She gave me her word.

I walked in as Rebecca ran and jumped in my arms and said "Daddy I missed you" Thanks for the hug sweetie. "Where is mommy. She's upstairs. "There you are," Why'd you sleep at the office." It was a long day I said with the crash and everything. I had met with a reporter. "Why'd you do that she said?" Something wrong? I felt worried and said there's nothing to worry about? I just had to get something off my chest. She could feel that I was sort of standoffish.

So I laid on the bed and crashed. I had slept for 15 hours. My wife had said long nap huh? I had told her it was going to be a long month. I told her I would need her tenacity and calm for the month ahead. I told her I might be on T.V. and that a lot of people wouldn't like what I had to say about the crash. I told her not to worry that our family life might not be so private. I told her I loved her more than life itself. I told her I would have to leave for a while and that we should have Rebecca live with my parents for a little while. She had been there through thick and thin, and she was ready to back me a hundred percent. I packed a bag and told her I was doing the right thing and I couldn't let peoples fortunes be wiped out. That's not why I took this job. I said I had a duty to the public and it just wasn't right. I just couldn't live with Washington's lies. I just couldn't live with the guilt that a certain cadre of people had ruined the lives of so many.

So I took my things and went to a hotel just to cool off. I was to meet with Ellen again and told her to meet with me at the hotel lobby. We were to meet in one of their business suites.

I took the day just to rest and clear my head. I kept thinking to myself is this okay. I could put my own life and my career in jeopardy for doing the right thing. It was my honest forecast that no one wanted to hear. It was my friends who would talk to me later and they were telling me I was committing political suicide. So I took a couple aspirin opened a Glenlivet bottle I had picked up at the liquor store and took a long hard swig and fell asleep.

I had passed out for over a full day. The sleep had just been what I needed. My thoughts languished for some time. It was my theories in side my head that kept me awake for hours. The game theorists kept drilling me in the head. A two game summary was like a Gregorian chant and the mantra of my theory. My theory was twofold. First it had been the forecast of market principles that weren't in the economy. It was the economics after taxes that played into account. It was the GDP that translated into a trillion dollar economy. It was how much money we spent on a war, the money that was set aside for the CIA. It was market principles without the variables that people didn't understand. It was the money and the manipulation of business and the market that people didn't understand. It was where the tax money had funneled. It was corrupt policies that didn't equate to the theory of games. All the game theorists had it wrong. They didn't go through my checklist. It was my theory that every market economy had to play to the fact that business is never sound. It was the theory that people didn't play by the rules. It didn't factor in all the cheating that the players were doing. It didn't factor in that when the players couldn't play the game fair they would cheat. The market didn't account for people who couldn't work. It was those people who started robbing banks, the business men who couldn't find contracts, it was people who cheated to cover their own ass. It was how the market was shaped. It was my theory that the games had hidden rules. The whole economy had more market forces than planned. It was the game theorists who didn't factor in what the market actually was. The market wasn't what people actually thought it was. The market was chaos theory. Chaos Theory I said. No one could predict the Chaos Theory. A look into chaos theory and the theory of the market is what people had to really look at.

Ellen was supposed to meet me in the lobby. We walked to the business suite closed the door, and started talking. She wanted to know why Washington and the big wigs had hired me in the first place. I told her my theories on the market is what they wanted, but it wasn't true they just wanted me as their pawn someone they could manipulate someone who could handle all the bullshit in Washington. They had me take on some very important business people. Some later on that would control some major interests. There were a select few behind the scenes who ran things in Washington. They had a lot of money, power and influence. These people they called the shadow people. They were special interest and signed off on the lobbyists. They didn't like to be called wrong. It was just the way that they ran things in Washington. The secret societies, the Yalie aristocracy, and the cadre walking in lockstep.

The shadow people had power and influence. They could make you disappear if they wanted to. The shadow people controlled 84 percent of the brokerage houses. They controlled 83 percent of the banks, and they wrote 58 percent of the laws. It was the government behind the scenes. The shadow people had fucked up this time. They had controlled the businesses who had run rampant with corruption. They had let the Japanese crash the market, and they had let the market go haywire. It was the economic bubble they hadn't found. It was their pen and ink that had crashed the market. It was the shadow people that we were going to expose. Ellen had told me to watch my back and she was going to put in an anonymous name and call me in the morning. They had no idea who we were or what we were going to do but it was about time that the people new what Washington really was and it was the select few who had poisoned the well water.

The special interests were the ones I was thinking of. The lobbyist scenario that I came up with in college on the theory of economic games. I came up with a scenario that stemmed from my political science class I took. Now it was the direct effect that set the political cog in action. It was the few who actually controlled the stock market, the few who had senators in their pockets and the select few who had crashed the fucking market. It was the Japanese who had crashed the market and took out their money. It was Washington who hid it. It was the shadow people who had created it. It was the left hand not telling the right hand what it was doing. That created the bubble. The Japanese created the crash and with it all our fortunes.

Short Story

About the author

Lee Roby

I published Trigonometry Simplified on Amazon. I like to write fiction as well as non-fiction. This is all a learning process for me and as I progress through this maze called life hopefully my passion and writing becomes greater.

Reader insights

Be the first to share your insights about this piece.

How does it work?

Add your insights

Comments

There are no comments for this story

Be the first to respond and start the conversation.

Sign in to comment

    Find us on social media

    Miscellaneous links

    • Explore
    • Contact
    • Privacy Policy
    • Terms of Use
    • Support

    © 2022 Creatd, Inc. All Rights Reserved.