Veteran market forecaster Peter Schiff is still upset at the Federal Reserve's response to the Black Monday crash of 1987, where the Dow Jones Industrial Average fell 508 points (over 22%).

Schiff, who was 24 at the time, wrote a letter to Federal Reserve Chair Alan Greenspan.

"I was critical of what he was doing because it didn't seem to jive with what he stood for as far as free markets," Schiff said in an interview with TheStreet.

The Federal Reserve issued a statement on Oct. 20, 1987 -- the day after the crash -- in an effort to soothe nervous investors:

"The Federal Reserve, consistent with its responsibilities as the Nation's central bank, affirmed today its readiness to serve as a source of liquidity to support the economic and financial system."

Within 24 hours following the crash, the Fed also cut the fed funds rate to 7% from 7.5%. Lower interest rates make it cheaper for companies and consumers to borrow money.

Schiff wasn't too fond of the Fed's intervention, as he explained in his letter to Greenspan, which Schiff is not able to locate.

Greenspan replied to Schiff's letter. Remember, Schiff was only 24 at the time.

"He basically said in theory it would be great to allow the markets to function, but practically the Fed can't sit idly by," Schiff said.

Greenspan, in his response to Schiff, acknowledged the worrisome deficit and debt levels at the time. But Schiff was perplexed as to why Greenspan intervened in the markets, cut interest rates and made it easier for U.S. debt to rise.

"And here we are with a $20 trillion national debt - when he sent me that [letter], it was a tenth of that," Schiff said. "Obviously I was right as a 24 year old kid and Greenspan was wrong as the Fed Chairman."

Amid all the anxiety, Black Friday proved to be quite a buying opportunity. The Dow is up over 1,200% since October 19, 1987.

Here's Greenspan's response to Schiff: 

Follow @ScottGamm on Twitter.

Watch our entire 20-minute conversation with Peter Schiff:

Crash of '87 - TheStreet Special Report

Black Monday made headlines 30 years ago today. Check out our full Crash of '87 Special Report for the ultimate #TBT:

Originally published Oct. 19.

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