Black Monday, the 1987 market crash, prompted the United States to create the presidential working group later nicknamed the Plunge Protection Team.
President Ronald Reagan issued Executive Order 12631 on March 18, 1988, establishing the Working Group on Financial Markets. The group included the Treasury secretary, the chair of the Federal Reserve, the chair of the Securities and Exchange Commission, and the chair of the Commodity Futures Trading Commission.
Its formal purpose was to improve the integrity, efficiency, orderliness, and competitiveness of U.S. financial markets and to recommend regulatory changes. The nickname “Plunge Protection Team” became popular in the media, although it is not the group’s official name.
Black Monday occurred on October 19, 1987, when the Dow fell 22.6%. The working group was not created to erase market losses mechanically; its role was coordination and advice on market structure and financial regulation.