Today on October 24, 1929, U.S. stock markets plummeted eleven percent on Black Thursday — triggering the Great Crash followed by a decade of profound economic depression.
The Wall Street Crash of 1929 began on “Black Thursday” (October 24, 1929) when traders at the New York Stock Exchange started to mass sell-off at the opening bell. Only a month before, the London Stock Exchange crashed when its largest investor Clarence Hatry and his associates were arrested for fraud and forgery. Fear and doubt quickly spread overseas, as American investors started losing confidence in the markets. Savvy investors and ordinary traders alike began asking a fundamental question: could the stock market really continue to go up forever?
Several leading Wall Street bankers, including the top executives at Chase National, Morgan Bank, and National City Bank, had an emergency meeting that day. They all agreed that intervention was paramount and bought massive amounts of American Steel and other blue-chip stocks at above-market prices. This strategy had worked in the past, and the markets slightly recovered the following day; however, these gains proved only to be temporary. On Monday morning, many investors lost confidence and ultimately pulled out of the market. The Dow Jones dropped another thirteen percent. The following day was dubbed as “Black Tuesday.” The panic had reached its peak. More than sixteen million shares were traded with an additional twelve percent drop in market capitalization.
The “Roaring Twenties” had come to a sudden and devastating end. The Great Crash left a lasting effect around the world, as every stock market (except Japan) went into a downward spiral. Almost 30,000 American businesses went bankrupt within three years, leaving 15 million workers unemployed. The Great Depression that followed lasted over ten years and proved to be the worst economic downturn in the history of the industrialized world.