Last week marked the 30th anniversary of the 19 October 1987 stock market crash, often referred to as "Black Monday," when panic selling caused huge losses across global share markets, with the US share market experiencing its largest one day fall in modern history.

The Dow Jones Industrial Average (DJIA) declined by around 23 per cent on Black Monday, the biggest one-day drop, in percentage terms, for the index. That drop spurred on huge losses elsewhere. Australian shares fell 25 per cent on October 20 and lost 50 per cent over two months. US shares fell a total 34 per cent over three months.

According to famed economist Robert J. Shiller, recently writing in the New York Times, it could all happen again.

"We are still at risk … because fundamentally, that market crash was a mass stampede set off through viral contagion. That kind of panic can certainly happen again," he writes.

"Many people believe that stock prices are already very high, and if the right kinds of human interactions build in a crescendo, we could have another monumental one-day decline … We are at risk, but with luck, another perfect storm--like the one that struck 19 October 1987--might not happen in the next 30 years."

One key difference is that US market regulations are now in place that are intended to stop another one-day market collapse. In response to the 1987 crash, the New York Stock Exchange introduced Rule 80B, a "circuit breaker" that would shut down trading for the day if the Standard & Poor's 500 index fell 20 per cent from the previous close.

Australian economists say another Black Monday isn't likely in Australia. "Investors should never be complacent. But markets have been rising in response to low inflation, stronger global growth, and higher corporate profits. So, there are good reasons for the gains," says CommSec chief economist Craig James.

Financial and regulatory systems are stronger and increased globalisation means that policymakers will be more responsive to volatility, adds James.

According to Dr Shane Oliver, AMP Capital's chief economist, the current environment around share markets is very different to 1987 and there are few signs of a bubble.

"Overall, we are still not seeing the signs of excess, euphoria, and exhaustion that typically come at cyclical economic and share market peaks ahead of recessions and deep bear markets. So, barring some sort of external shock, the cyclical bull market in shares looks like it still has further to go," says Oliver.

Any market correction would be preceded by signs of excess, such as rapidly rising inflation, aggressive tightening in monetary policy, clear asset overvaluation, and investor euphoria.

"This would then set the scene for the next economic downswing and hence a more severe bear market, as opposed to a correction or short-term bear market like we saw in 2015-16," says Oliver.

"Corrections should be anticipated--with Trump, North Korea and the Fed being potential triggers--and the fickleness of investor confidence means we can't rule out another crash like in 1987. But despite this we still appear to be a long way from the peak in the investment cycle," says Oliver.

While share valuations, as measured by price-earnings ratios, are comparable to valuations right before the 1987 correction, much lower inflation and interest rates make today's prices look more reasonable, adds AMP's Oliver.

However, if interest rates were to rise quickly in response to higher inflation then this could flatten the trajectory of share markets. While AMP's Oliver see this as a possibility, CommSec's James says interest rates aren't likely to rise quickly in Australia.

"We expect global competition to keep a lid on inflation, meaning only modest increases in interest rates. Interest rates are expected to remain stable in Australia until December 2018," James says.

The ASX 200 has gained around 16.5 per cent over the year to 26 August 2017, compared to the S&P 500 which is up around 22 per cent.

Oliver says the current US bull market is eight and a half years old. It's the second longest since World War II and the second strongest in terms of gains, which has prompted many analysts to speculate on its end.

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Nicki Bourlioufas is a Morningstar contributor. This is a financial news article to be used for non-commercial purposes and is not intended to provide financial advice of any kind. Opinions expressed herein are subject to change without notice and may differ or be contrary to the opinions or recommendations of Morningstar as a result of using different assumptions and criteria.

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