What things are effectivelly:

Black Monday is a debuff to Germany, because it's simply the most powerful nation in the game along with the U.S. (which gets its own set of debuffs). Without these debuffs the game would be boring because Germany - even AI Germany - would be able to just brute force everything with success.

Now, since the mod is also a narrative experiment on the alternative history genre, these debuffs that make the game enjoyable have to be backed by story devices that justify them. Having a sudden crashdown on a seemingly bloated economy like that of Germany is a fairly good narrative device. Nobody understands economic crashes too well but they happen all the time and as the genre of alternative history fiction depends upon special traits that mimic those of actual historiographical narratives - what some people call "realism" - as means to keep the suspension of disbelief - necessary in all fictional stories but achieved in different ways -, using Black Monday as the device to justify the debuffs is better than, say, having all the German General Staff die of Space AIDS or having a plague of steel-eating locusts destroy the German industry.

The point is: it's just a story. I'm sure all screenwriters of the mod do the best they can and the proof is that we're here discussing a market meltdown from a fictional setting. If you want to actually understand economic crashes and how sometimes miraculous recoveries are achieved, you'd have to read from the richness of economic literature on the topic. The problem with what you ask at the end, in search of ways that the narrative exercise of Kaiserreich conforms too strictly with the content of actual historic narratives, is that while the debuffs for Germany are fundamental for game balance in the beginning, maintaining them for a long period would just doom the enjoyment of playing Germany - and consequently of playing as its adversaries - as you'd lose everytime. That would defeat the whole purpose of the game, which is to be entertaining.

My suggestion is that you tone down your demands for the suspension of disbelief - which you probably already do when enjoying normal fiction. Alt-history stories are just childish fantasies after all and "realism" is nothing more than good screenwriting.