AP file photo

The Dow took a tumble yesterday, but Wendy Murphys phone was quiet.

It stood in contrast to 25 years ago when Murphy, a certified financial planner with Morgan Stanley Smith Barney in Shrewsbury, was just beginning her career.

On Oct. 19, 1987, a black Monday as it would turn out, sellers unloaded their stocks, sending the indexes down 18 percent to 23 percent.

Reading this report by the Federal Reserve, it looks like there were a few warning signs; the S&P fell 9 percent the previous week, when a House Committee proposed legislation to end tax breaks associated with financing mergers (sound familiar?). And the Commerce Department said the trade deficit unexpectedly widened, prompting speculation that the Fed would tighten its monetary policy.

Yet once Monday came around, the snowball only gathered momentum. The main reasons, reading the Fed report are awfully technical, involving margin calls and program trading for portfolio insurance.

(By the way, I know I should understand this by this point in my business writing career, but the truth is I have watched Trading Places probably 78 times and still dont understand how Billy Ray and Winthorpe managed to pump up the price of corn and then have it crash, leaving the Duke brothers broke. And I defy any of my friends who to this day quote that movie liberally to say they understand either. Lionel Joseph? From Cameroon?

So if anyone out there can explain in English margin calls, portfolio insurance or Trading Places, please do).

OK, so anyway, 1987 was before CNBC and the Internet. People got their financial news from the newspapers. And the Wall Street Journal famously began its next-day story with one of business journalisms great leads: The stock market crashed yesterday.

For all the panic, the market regained its lost ground by the end of the year. It could have been worse. In fact, it was worse when the housing bubble collapsed. The Dow still is about 1,000 points shy of its pre-bubble peak.

But Murphy said mom and pop investors are more sophisticated today. Back then, they might have owned stocks and bonds. Today, they have diversified and manage their portfolio based on when they will need the money: An emergency fund, a retirement fund, a college fund, a vacation/car/house fund.

With the Dow sinking yesterday, Murphy said no one called her in a panic. Youre preaching calm, she said. Its just preaching reason. Just be reasonable. Dont so anything unreasonable. If theres a panic in the marketplace, keep your head. Invest in great companies. Invest in the long-term.