I don't know if the rest is fiction, but it didn't cause the crash. Some traders I know have told me that many knew they were wiped out before futures/markets opened.
"In 1986, the United States economy began shifting from a rapidly growing recovery to a slower growing expansion, which resulted in a "soft landing" as the economy slowed and inflation dropped. The stock market advanced significantly, with the Dow peaking in August 1987 at 2722 points, or 44% over the previous year's closing of 1895 points.
On October 14, the DJIA dropped 95.46 points (a then record) to 2412.70, and fell another 58 points the next day, down over 12% from the August 25 all-time high.
On Thursday, October 15, 1987, Iran hit the American-owned supertanker, the Sungari, with a Silkworm missile off Kuwait's main Mina Al Ahmadi oil port. The next morning, Iran hit another ship, the U.S. flagged MV Sea Isle City, with another Silkworm missile.
On Friday, October 16, when all the markets in London were unexpectedly closed due to the Great Storm of 1987, the DJIA closed down another 108.35 points to close at 2246.74 on record volume. American Treasury Secretary James Baker stated concerns about the falling prices.
The crash began in Far Eastern markets the morning of October 19. Later that morning, two U.S. warships shelled an Iranian oil platform in the Persian Gulf in response to Iran's Silkworm missile attack on the Sea Isle City.[8] [9]"
"The link at the end, which leads to a story about a VAX machine getting into trouble, might be erroneous. I suggest this because I've seen the story before without the line at the very end linking it to Black Monday (in fact, I always thought the event took place significantly prior to 1987). While it's possible that somebody might add this last line to add dramatic emphasis to the story, it's unlikely that it would be cut out by somebody - it's forms a punchline to the story. Therefore I think the link between this VAX story and Black Monday is probably incorrect.
Note: the joke link in question (*Alleged computer mishap) was removed 2005-11-05 RaulMiller 00:20, 22 November 2005 (UTC)"
Seems like there were no emergency shutdown protocols yet for the programs trading stocks so it amplifies and hasten the process. Protocols were implemented after that (from wikipedia).
