Here’s All That Stands Between You and Stock Market Oblivion

The market ’s down 400 full point today , continue this terrorific screaming - ride we ’ve been on . EVERYBODY PANIC . Right ? in reality , here ’s how — and when — the NYSE prevents one - finish - drop financial Armaggedon .

Since 1988 , pep up by the former year ’s fatal Black Monday dive — the NYSE has had circuit breakers in place to foresee any nosedives that would cause a systemic prostration . While you might reckon 400 point sounds dramatic — and it certainly is a healthy clod — it ’s not closely enough to slacken trading down , much less stop it all in all .

As this chart from NYSE - Euronext shows , the circuit breakers come into play only when the market lose a certain percentage , and even then only at a certain time of day . A 10 % drop ( 1200 points , three times what we ’re looking at as of this C. W. Post ) before 2 post-mortem will cause a one - hour halt in trading , but after 2:30 it ’s business as common . Likewise a 20 % drop cloth will cause a two - hour pause before 1 pm , and will shutter the mart for the day if it happens after 2 pm . In fact , for the market to keep out down entirely regardless of sentence , it would have to drop 30%—around 3600 point .

Burning Blade Tavern Epic Universe

As you may imagine , the organisation does n’t plain in very often ; two induction points were dispatch on October 27 , 1997 , when the grocery was first halted for thirty min , then closed for the twenty-four hour period , but that ’s pretty much it . A more common happening is when the electrical circuit surf cut off trading on individual stocksthat uprise or fall more than 10 % in five mo .

So ! palpate console in the knowledge that if thing do manoeuver flat to hell , there are at least a couple of speed bump . And be terrified knowing that we ’ve got so much further to drop before we hit the first one . [ NYX ]

ikon credit : Shutterstock / AlexAranda

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