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This article describes what led up to the stock market crash of 1929 and the ensuing Great Depression:
[Editor’s Note: This version* of the original article by Jesse’s Le Café Américain has been edited ([ ]) and abridged (…) by 78% for a FAST – easy – read. Please note: This complete paragraph must be included in any re-posting to avoid copyright infringement.]
“…People believed that everything was going to always be great… America had come out of World War I with its economy intact – the only strong country in the world – and the dollar was king.@A Financial Site For Sore Eyes & Inquisitive Minds
Wall Street got the credit for this prosperity and Wall Street was dominated by just a small group of wealthy men. Rarely in the history of this nation had so much raw power been concentrated in the hands of a few businessmen…
Everything was not fine that spring with the American economy, however. It was showing ominous signs of trouble:
- Steel production was declining.
- The construction industry was sluggish.
- Car sales dropped.
- Customers were getting harder to find
- and, because of easy credit, many people were deeply in debt.
On September 5th, economist Roger Babson gave a speech to a group of businessmen. ‘Sooner or later, a crash is coming and it may be terrific.’
He’d been saying the same thing for two years, but now, for some reason, investors were listening:
- The market took a severe dip…
- The next day, prices stabilized,
- but several days later, they began to drift lower.
Though investors had no way of knowing it, the collapse had already begun.
On Wednesday, October 23rd,…the market was a little shaky, weak and, whether this caused some spread of pessimism, one doesn’t know. It certainly led a lot of people to think they should get out.
On Thursday, October the 24th —the first Black Thursday—the market, beginning in the morning, took a terrific tumble.
- The market opened in an absolute free fall and some people couldn’t even get any bids for their shares and it was wild panic…
- In brokers’ offices across the country, the small investors—the tailors, the grocers, the secretaries—stared at the moving ticker in numb silence. Hope of an easy retirement, the new home, their children’s education, everything was gone.
At the end of 1929
…The bubble had burst. Gone was that innocent optimism, the confidence, the illusion of wealth without work…[An] era had ended…they knew the party was over.”
(*The author’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.)
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