October 19, 1987 was the day that the Dow fell a record 22.6% -- then a record 508 point decline. (The Dow lost a total of 21.8% during that month). By contrast, the current month is on track to end down a relatively modest 16.6%. But even though the Dow went down much more in October 1987 than it did in October 2008, it turns out that the 1987 crash preceded the economic contraction by about two years. By contrast, the October 2008 crash seems to be happening at the same time as the economy implodes.

I remember the October 1987 crash well because I was working in a consulting firm whose CEO asked a colleague of mine to come up with a list of stocks to buy. He was convinced that the 508 point decline was an anomaly that did not reflect the state of the economy. And it turns out, he was right. The 1987 crash seems to have been caused by a computer based trading program that got out of control.

By contrast, when we look back on the current economic and stock market downturn, we may see the peak as having taken place in the summer of 2007 -- that is about the same time that the Dow reached its high above 14,000 which took place in October 2007. Unlike in 1987, I would be surprised if that consulting firm's CEO told one of his people to find him stocks to buy after stocks tumbled this month.

In that sense, even though the market suffered much more in October 1987 than it did this month, I would not be surprised if the current market downturn presaged a much more painful economic contraction.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter.

Texas Instruments Inc (NYSE: TXN), the wireless chip giant, reported strong results last night, citing the wireless semiconductor inventory overhang as being over. Most impressive was the level of profitability during this downturn with TI exiting a semiconductor trough with 51% gross margins and over 20% operating margins.

Since 25% of revenue in semiconductor orders is from consignment or EDI systems, the information is pretty good that an upswing is beginning. Also, along with book-to-bill hitting 0.99, March sales increased 20% versus sales in February. Further, April's numbers remain strong.

TI said the biggest factor for the upswing is the inventory overhang being over, which is having more of an impact than specific product wins. However, its high-end analog products' compound annual growth rate is 19% versus 8% for its primary competitors.

Also, look at National Semiconductor Corporation (NYSE: NSM), which has followed a similar patten during this inventory correction. National will most likely give investors more bang for the buck. Further, it is time to start looking at Motorola. If there was a true inventory overhang, with its stock down big, investors need to start chipping away at the RAZR manufacturer.

Guest blogger and avid investor Bob Sirmans offers this perspective on recent market events:

Conventional wisdom used to support the notion that market downturns were buying opportunities and investors should use them to add to or open new positions. It seems to me that the tech wreck of the early 2000s has changed how people invest and their views on markets. Now it's not quite so clear that a downturn is necessarily a good time to buy.

However, in spite of the fears that people have, I can't imagine not using dips/corrections as a good time to buy. I used the market spiral yesterday to open a new position in a stock I've been looking to buy to give me more exposure to American companies that generate a least 1/2 of their revenue (on a percentage basis) from outside the US. Yesterday I bought some Caterpillar Inc. (NYSE: CAT) on the market slide.

The way I see it, the US and China economies are both showing signs of slowing. While I think this will rattle the markets, putting money in the bank isn't what I want to do.

Am I more likely to take profits now? Absolutely. But I still need to keep my money working.

Does anyone else still view market downturns as a buying opportunity?