Although investors stand about today, white-knuckled and awaiting the next crash, it remains obvious that many of the principal drivers leading to the 1987 crash are not present today. The rise in bond yields, crude oil prices, and the trade deficit combined with the collapse of the dollar and general investor confidence all provided the context for the collapse in stocks. Although valuations were near all-time highs prior to the crash, the valuations themselves did not drive the crash -- it was the exogenous events that muddled economic forecasts and that in the end wrecked havoc with bond prices that provoked the cataclysm. Like a closed room filling with gas from a leaking pipe, it is hard to blame the resulting explosion completely on the poor soul who struck a match.
Interesting how they mention the middle East events, then yesterday ... Third U.S. carrier steams towards Persian Gulf-Debka.com - According to Debka's military sources, the USS Enterprise, the U.S. Navy's largest air carrier, will join the USS Stennis and the USS Nimitz carriers, creating the largest sea, air, marine concentration the U.S. has ever deployed opposite Iran. [Reference Link]:[http://www.debka.com/]
and the dollar http://finance.yahoo.com/currency/convert?from=USD&to=EUR&amt=1&t=5y
And yields etc ...
