During the 1987 stock market crash, Federal Reserve chairman Alan Greenspan pledged to provide liquidity to the financial system.
Greenspan had become chairman of the Federal Reserve in August 1987, only weeks before global markets suffered their sharpest synchronized falls. On October 20, 1987, the day after the most severe selling, the Federal Reserve issued a brief statement saying it was ready to serve as a source of liquidity to support the economic and financial system.
The statement helped reassure banks and market participants that the central bank would keep the payments system functioning. The Fed also encouraged commercial banks to continue lending to securities firms, helping prevent a market panic from becoming a broader banking breakdown.
A common mix-up is assigning the response to Paul Volcker, who chaired the Federal Reserve during the early 1980s but left office before the 1987 crash. Ben Bernanke became chairman much later, in 2006.