WhyItDropped

KOSPI · September 16, 2008

Lehman Files — KOSPI

-6.10%

single-day change vs previous close

Part of a longer stretch

The KOSPI in the financial crisis

near the end of it · 2007-10-31 → 2008-10-24, -54.54% over the whole period

What happened that day?

  • Lehman Brothers filed for bankruptcy protection on 15 September 2008 — early Monday in the US, while Asian markets were already trading
  • KOSPI fell 6.1% on the next session, 16 September
  • That a 158-year-old investment bank was allowed to fail without rescue was itself the signal: the rules had changed
  • Until then, markets assumed some firms were too big to be allowed to fail
  • Once that broke, the creditworthiness of every financial institution had to be recalculated
  • Not knowing who was next produced the fear of the following months
  • Fell 50.21% from peak

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.