Black Tuesday 1929

The Brooklyn Daily Eagle’s front page after the Oct. 24, 1929 stock market crash.

Introduction of the Stock Market Crash of ‘29

The Roaring Twenties, which was a precursor to the Crash, was a time of prosperity and excess in the city, and despite warnings against speculation, many believed that the market could sustain high price levels. Shortly before the crash, Irving Fisher famously proclaimed, "Stock prices have reached what looks like a permanently high plateau." The euphoria and financial gains of the great bull market were shattered on Black Thursday, when share prices on the NYSE collapsed. Stock prices fell on that day and they continued to fall, at an unprecedented rate for a full month.

View of the New York Stock Exchange on an active day in the late 1920s. Share prices peaked in August 1929 before falling rapidly in October of the same year.

In the days leading up to Black Tuesday, the market was severely unstable. Periods of selling and high volumes of trading were interspersed with brief periods of rising prices and recovery. Economist and author Jude Wanniski later correlated these swings with the prospects for passage of the *Smoot-Hawley Tariff Act, which was then being debated in Congress. After the crash, the Dow Jones Industrial Average (DJIA) recovered early in 1930, only to reverse again, reaching a low point of the great bear market in 1932. The Dow did not return to pre-1929 levels until late 1954 and was lower at its July 8, 1932 level than it had been since the 1800s.

After an amazing five-year run when the world saw the Dow Jones Industrial Average (DJIA) increase in value fivefold, prices peaked at 381.17 on September 3, 1929. The market then fell sharply for a month, losing 17% of its value on the initial leg down. Prices then recovered more than half of the losses over the next week, only to turn back down immediately afterwards. The decline then accelerated into the so-called "Black Thursday", October 24, 1929.

The trading floor of the New York Stock Exchange just after the crash of 1929.

As to the US 700 billion bailout plan today, a similar plan occurred in 1929 and proved to be a failure and it has been always hoped the mistakes of the past would not be repeated, for the sake of all concerned; for it a situation of this particular nature it is very easy to do.

1929 Stock Market Crash

What followed after the crash where numerous people that had lost in the stock market of various ways commited suicide which while it was unfortunate, they did not take into account towards the future because of the panic; because some stocks while they appeared to be of no value at the time, later, became some of great value such as for example AT &T Telegraph and Telephone Company; which is still around today.

Breadline in New York City during the Great Depression. At this time Soup Kitchens where everywhere, many found in back alley's.

What also followed the ‘29 crash were the 1930’s Great Depression and the ever noted realism of “brother can you spare a dime.” Also around 1929, the US tried to reach outside market’s because of there major economic problem which proved to also not be in there favor to the global economic situation at that time; because the Depression that followed was global in nature.

Something I learned in school by a very good teacher was after the crash of ‘29, Shantytown’s, known as “Hooverville‘s” seemed to spring up almost overnight; in what was termed in more of the beginning of the 1930’s Great Depression. The term was coined by Charles Michelson, publicity chief of the US Democratic National Committee. Also, the tent cities of the time, tended to be coined with the same name. Furthermore, the song under the picture, “Happy Day’s are Here Again,’ was popular during the 1930’s Great Depression, it is a wonder if was to give people hope.

There was also a term in 1929, of children born this year in the US being called, “the ‘29 Crash babies.”

Furthermore, what need’s to be understood as the economic situation that is occurring in the 21st century, even being compared to the crash of ’29 while may very well be similar to the same outcome, the ’29 crash was later considered unavoidable. Kind of like the phrase, “A day late and a dollar short,” and forever will be a piece of sad fabric in the quilt of the chronicle of history.

*Smoot-Hawley Tariff Act, was basically the raising of import tax on the global market by the US and in turn the Global market did the same to the US. Which was later said to have been overturned, because of the major problems. One of those cases, of not being a good idea.