  We employed the log-periodic power law singularity (LPPLS) methodology to
systematically investigate the 2020 stock market crash in the U.S. equities
sectors with different levels of total market capitalizations through four
major U.S. stock market indexes, including the Wilshire 5000 Total Market
index, the S&P 500 index, the S&P MidCap 400 index, and the Russell 2000 index,
representing the stocks overall, the large capitalization stocks, the middle
capitalization stocks and the small capitalization stocks, respectively. During
the 2020 U.S. stock market crash, all four indexes lost more than a third of
their values within five weeks, while both the middle capitalization stocks and
the small capitalization stocks have suffered much greater losses than the
large capitalization stocks and stocks overall. Our results indicate that the
price trajectories of these four stock market indexes prior to the 2020 stock
market crash have clearly featured the obvious LPPLS bubble pattern and were
indeed in a positive bubble regime. Contrary to the popular belief that the
COVID-19 led to the 2020 stock market crash, the 2020 U.S. stock market crash
was endogenous, stemming from the increasingly systemic instability of the
stock market itself. We also performed the complementary post-mortem analysis
of the 2020 U.S. stock market crash. Our analyses indicate that the 2020 U.S.
stock market crash originated from a bubble which began to form as early as
September 2018; and the bubbles in stocks with different levels of total market
capitalizations have significantly different starting time profiles. This study
not only sheds new light on the making of the 2020 U.S. stock market crash but
also creates a novel pipeline for future real-time crash detection and
mechanism dissection of any financial market and/or economic index.
