Stock market crashes can be found quite easily throughout modern history. As it turns out, there have been quite a few notorious decline of stock prices, some of which made mainstream media headlines. Other events have gone by virtually unnoticed, and have even been forgotten about. It is not unlikely that we will see more stock market crashes in the future, but for now, let’s take a look at what history has taught us.

#4 The Mississippi Bubble

Nearly three hundred years ago, the Mississippi Bubble caused an economic collapse in France. Scottish adventurer John Law established the Banque Generale, which was allowed to issue banknotes. He eventually took over France’s entire mining effort and foreign trade, including the development of French territories in the Mississippi River valley. This latter feat was possible due to him having created the Compagnie Des Indes, which monopolized all of France’s colonial trades.

The potential profits of the Compagnie des Indes attracted public interest. Shares were sold at much higher rates than they would return in earnings. After merging the Banque Generale with Compagnie des Indes, Law sold company shares for state-issued public securities. This created a wild speculation frenzy across all of Europe and increased the printing of paper money by the French government. As a result, French state-issued security notes started to suffer from inflation. In 1720, the value of company shares caused a stock market crash in France, which also affected other countries.

#3 Panic of 1825

The Bank of England started this 1825 stock market crash, due to speculative investments in Latin America. England felt the brunt of this crash, resulting in the closure of six London banks and several dozen country banks. This stock market crash is often referred to as the “first modern economic crisis not attributable to an external event.” A combination of the industrial revolution, rapid financial developments, and wartime finance proved to be a perfect cocktail for this dark period in England’s history.

#2 The Flash Crash of 1962

Between December 1961 and June 1962, the US stock market experienced a significant decline. This change came after decades of growth since the 1929 Wall Street crash and saw the S&P 500 decline by as much as 22.5%. A rapid expansion of the US economy, coupled with a bullish stock market created an environment ripe for profit taking. American Stock Exchange’s Edwin Posner called this decline an “adjustment from previous years of growth.”  The SEC labeled this market slide as a one-off incident, and its root cause was never confidently ascertained.

#1 September 1992’s Black Wednesday

In more recent times, the British Conservative government was forced to withdraw the pound sterling from the European Exchange Rate Mechanism. This decision was made once it became clear the pound could not be kept above its agreed lower limit in the ERM. It turned out this dark day in the history of the British pound cost the UK Treasury as much as 3.4b GBP, although that number has been contested ever since.

Keeping a fixed exchange rate for the pound sterling made sense at that time, although maintaining it proved to be far more difficult. It was up to the British government to prevent exchange rate fluctuations of more than 6%. George Soros, who had accumulated large holdings of pound sterling, made a profit over 1 billion GBP by short selling the pound sterling in the months leading up to September 16, 1992. Despite an increase in foreign currency reserve spending to prop up the pound sterling, these efforts were insufficient to maintain the maximum 6% fluctuation limit.

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