This Day In Market History: Alan Greenspan's First Fed Meeting

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened? On this day in 1987, Alan Greenspan chaired his first Federal Reserve meeting.

Where The Market Was: The Dow Jones Industrial Average closed at 2,654.66 and the S&P 500 traded at 329.25.

What Else Was Going On In The World? In 1987, “The Simpsons” first appeared in a cartoon short on “The Tracey Ullman Show.” U.S. President Ronald Reagan delivered a speech at the Berlin Wall urging Soviet Union leader Mikhail Gorbachev to “tear down this wall.” The average American income was $24,350.

Greenspan’s Debut: After hours of discussion at his first Federal Reserve meeting as Fed chair, Greenspan commented on one subject that had not been addressed.

“We spent all morning, and no one even mentioned the stock market – which I find interesting in itself,” Greenspan said.

Greenspan would remain as Fed chair through 2006 and would oversee one of the longest and strongest bull markets in history. Greenspan’s aggressive Fed policies became known as the “Greenspan put,” the idea that the Fed would be extremely proactive in acting to prevent excessive stock market declines.

Critics argue that Greenspan’s policies were largely responsible for the dot-com bubble of the late 1990s.

Greenspan would ultimately serve the second-longest tenure as Fed chair behind only William McChesney Martin, who held the position from April 1951 to January 1970. Within two years of Greenspan’s departure, the stock market crashed 50% from its highs under new Fed Chair Ben Bernanke during the subprime mortgage crisis.