Facts About The Stock Market Crash Of 1929

By | November 26, 2022

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Bankrupt investor Walter Thornton tries to sell his luxury roadster for $100 cash on the streets of New York City following the 1929 stock market crash. Getty Images.

It Happened Slowly

During the 1920s, the stock market seemingly soared, and Wall Street investors were brimming with confidence in what is called a "bull market," in which prices of stock are expected to rise for the foreseeable future. Everybody was convinced that investing in stocks was a surefire way to make some easy cash, and the banks even gave ordinary people loans so they could try their hand at speculating even if they had no capital of their own. Likewise, manufacturers, business owners, and farmers were all taking out loans to keep the roaring '20s, well, roaring. However, by the end of the decade, production was down, unemployment was up, and wages weren't keeping pace with the cost of living.

It came time to pay the piper on October 24, 1929. After a few shocks to the market, brokers woke up that morning in a panic and began a massive sell off just moments after the bell chimed for the market to open. Stocks were sold so rapidly that their actual value became almost impossible to track down, which only panicked the brokers more. The president of the New York Stock Exchange, Richard Whitney, made a big show of overpaying for major stocks, specifically steel, as a show of faith in the market. This helped, and the Dow was actually only down a little over six points when it closed for the day, but the panic only picked up on the following Tuesday. All those loans that were holding up the economy suddenly get called in, resulting in the financial demise of many businesses and individuals.

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The trading floor of the New York Stock Exchange Building in 1930, six months after the crash of 1929. (Unknown author/Wikimedia Commons)

No One Jumped To Their Death

The day was so awful that many believe in a persistent myth that many investors, fleeced of all their savings, hurled themselves from balconies and high windows. This is partially due to Winston's Churchill's testimony that he witnessed a man jump out of a window that day, but that man was a chemist, not a broker, and he died several hours before the stock exchange opened. In reality, there is no record of any investor jumping to their deaths in the hours or days after the stock market crash. In fact, suicides in general were down across the city compared to the previous months.