Stock Market Crash of 1929

Stock Market Crash of 1929

The Stock Market Crash of 1929

The spectacular stock market crash of October 1929 was a time of reckoning for young and old, rich and poor.

Events leading up to that fateful day in October have been studied thoroughly over the years, and one point frequently touched upon is this: the signs of the times indicated that the boom in the stock market was headed for a dramatic slowdown.

A fundamental law of nature holds that what goes up must come down. But few people around during the so-called Jazz Age seemed to grasp that the stock market could not soar forever.

What made the crash of 1929 so tragic was the cross-section of society left reeling in the aftermath. Research shows that from the mid to late 1920s, participating in the stock market was a popular endeavor for people of all socio-economic backgrounds. Because people could purchase stock using a combination of cash and credit, many who otherwise wouldn.t have had the funds to play the stock market game were able to do so.

While many world governments saw the proverbial writing on the wall, most of them basically followed the laissez-faire school of thought, preferring not to interfere in the economy.

Self-preservation, some believe, was behind the Coolidge administration.s decision to leave well enough alone. Even if his administration were to have intervened, proponents argue, it may have been blamed if the implemented steps failed to prevent the stock market crash.

In March 1929, the global economy was rocked by a micro-scale crash, which caused a severe case of the jitters throughout the global community and offered a glimpse of what was to come.

Things got ugly on October 24, 1929, when close to 13,000,000 shares were traded on the New York Stock Exchange.exceeding the previous record of about 4,000,000 shares.

The following day featured frenzied activity, but the weekend ushered in a respite from the stock market turmoil.

But on Monday, the situation once more started to deteriorate, with heavy losses being recorded.

Then there was Tuesday, October 29, the day now referred to as Black Tuesday. 16,410,030 shares were traded that day. Panic ruled as people began unloading their securities.