Ninety-four years ago, on October 29, 1929, the New York Stock Market crashed, after days of falling stock prices and business bankruptcies. Called "Black Tuesday," it marked the beginning of the Great Depression which lasted well into the 1930s. Economist and ambassador John Kenneth Galbraith wrote in his 1955 book "The Great Crash, 1929" about the downward spiraling market and the shattering effects it had:
“The worst continued to worsen. What looked one day like the end proved on the next day to have been only the beginning. Nothing could have been more ingeniously designed to maximize the suffering, and also to insure that as few people as possible escape the common misfortune....The man with the smart money, who was safely out of the market when the first crash came, naturally went back in to pick up bargains. The bargains then suffered a ruinous fall. Even the man who waited for volume of trading to return to normal and saw Wall Street become as placid as a produce market, and who then bought common stocks would see their value drop to a third or a fourth of the purchase price in the next 24 months.....Clerks in downtown hotels were said to be asking guests whether they wished the room for sleeping or jumping. Two men jumped hand-in-hand from a high window in the Ritz. They had a joint account.”
There are safeguards and institutions in place now hopefully to prevent a total market collapse, the most recent following the stock market drop in September 2008. But no safeguards that involve speculation, money and greed are failsafe.
(photo: The Boston Globe)
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