Which 1989 market event became known as the Friday the 13th mini-crash?
Answer
United Airlines buyout collapse
The 1989 Friday the 13th mini-crash followed the collapse of a proposed buyout of United Airlines.
On October 13, 1989, the Dow Jones Industrial Average fell 190.58 points, or 6.91%, in a sharp U.S. market decline. Investor confidence was damaged when the leveraged buyout of UAL Corporation, United Airlines’ parent company, failed to obtain financing.
The proposed transaction had attracted attention because it was a very large leveraged buyout. When financing disappeared, investors reassessed the wider market’s valuations and the risks associated with highly leveraged deals. Selling spread quickly, although the decline was much smaller and shorter-lived than the 1987 crash.
The event is called a mini-crash because it was a concentrated market shock rather than a prolonged collapse. It is not the same event as Black Monday in 1987 or the October 1989 global bond-market turmoil.