asked the Minister for Finance if he will make a statement concerning the recent turbulent activity on the Stock Exchange; and if he will outline any proposal he has for regulating the Exchange.
Written Answers. - Stock Exchange Activity.
47.
The proximate cause was the US stock market crisis arising from the inability by management of certain companies to complete the buy-out of those companies by so-called "junk" bonds (high cost bonds). The lead banks failed to raise the money they had hoped to get from Japanese banks. As a consequence, shares of companies caught up in take-over activity first, and later virtually all shares dropped in price on Wall Street. The Dow Jones industrial average fell late on 13 October by 190 points. This fall so adversely affected investor confidence that share prices on stock markets throughout the world fell back also. Nevertheless, share prices on the Irish Stock Exchange generally recovered within a day or two.
There are no proposals to attempt to "regulate" share price movements on the Irish Stock Exchange.