For many months, the stock market was doing very well. Many investors bought parts of companies. These parts are called shares. When the companies did well, the price of the shares went up. The investors were very happy with their money.
Then, some news came out about the banks. The banks had a problem with their loans. They gave money to people, but some people could not pay the money back. This was bad news for the banks.
The investors heard this news and became worried. They did not want to lose their money. So, many people started to sell their shares at the same time. This made the price of shares go down. Everyone felt nervous about what would happen next.