After bad news on Wednesday, the stock market fell for the rest of the week.
Then everything collapsed after the weekend during “Black Monday”.
That was 1987.
- We don't have to wait long to find out if it happens again, says stock market analyst Jim Cramer to CNBC.
There has been great concern over the weekend ahead of the new stock market week.
After two days of blood-red numbers since Trump announced his punitive tariffs against the outside world at a press conference, there is “extreme fear” in the market, according to CNN:s ”Fear & Greed”-index.
Former Foreign Minister Carl Bildt has shared a picture of the index on X.
Warns of a new day of horror
"The mood was really grim in the American financial markets last week after Trump's tariff announcement," Bildt writes.
"What awaits tomorrow?" he asks himself.
It is a question that has kept market analysts awake over the weekend.
American analyst and host Jim Cramer aired his concerns during his own economic program on the CNBC television channel this weekend.
He warns that the world could face a new "Black Monday" - the stock market crash of October 19, 1987, when stock markets all over the world crashed.
- If the president does not extend a hand and reward those countries that play by the rules, then the scenario like 1987, when we went down for three days and then down 22 percent on Monday, could have the greatest impact, Cramer says on TV according to the New York Post.
Analyst and CNBC host Jim Cramer warns of new sharp declines. Photo: Gerald Herbert / AP
Worst ever
He believes the world won't have to wait long to find out if the stock market panic is back.
- We'll know on Monday, says Cramer.
The US stock index Dow Jones Industrial Average fell during "Black Monday" by more than 22 percent, which was the biggest single-day decline ever.
Before the fateful Monday, the Dow Jones had already fallen since Wednesday the week before after, among other things, news of unexpectedly high trade deficits, fears that stocks were overvalued and increased interest rates.
When the New York Stock Exchange opened on Monday afternoon Swedish time, the cork came out as everyone panicked and wanted to sell.
The panic on the New York Sto ck Exchange during “Black Monday” in 1987. Photo: AP
Big losses
Although most experts do not believe that it will get that bad, the current situation has some similarities to the chaos of 1987.
Donald Trump, citing the US trade deficit with the rest of the world, announced punitive tariffs of different percentages to basically all countries.
In two trading days on Thursday and Friday, the market value of the New York Stock Exchange’s S&P 500 index fell by the equivalent of 54,000,000,000,000 kronor, or about 5.4 million dollars.
The speed of the decline is compared to that during the pandemic in the spring of 2020 and the IT company crisis 20 years earlier.
The fall on Friday was partly due to China announcing that it would respond to Trump's tariffs by imposing an additional 34 percent tariff on goods from the United States.
Trump on his way to the golf course on Friday. Photo: Alex Brandon / AP
"It's going very well"
Trump himself spent the weekend at Mar-a-Lago and has been on site during a golf tournament at his resort in Miami.
He does not seem worried.
- It's going very well, you've never seen anything like it. The stock market is going to skyrocket, the country is going to flourish, Trump said as he left Washington on Thursday afternoon.
On the TV news shows on Sunday, several representatives from the Trump administration were interviewed and the message was: Don't panic.
The issue of the tariffs has created the first rift between Trump and his supporters within the Republican Party.
Among other things, Senator Ted Cruz, one of Trump's big supporters, has said that the tariffs could "hurt the United States" and that the consequences for the country could be "terrible".
Donald Trump's running mate Elon Musk has also stated that he is in favor of a system without tariffs between the United States and Europe.
Analyst Cramer was previously positive about Trump's tariffs, but now he has changed his mind.
- If President Trump continues to be unreasonable and does nothing to mitigate the damage in recent days, then I will not be constructive here, he says according to the New York Post.
- And if Europe goes after our fantastic tech companies next week, I will be furious.
The decline intensified at the end of the trading week.Foot
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