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post #1 of 2 (permalink) Old 10-29-2006, 11:13 AM Thread Starter
Join Date: Oct 2004
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Over 16 million shares were traded in panic selling on the New York Stock Exchange and thousands of investors were wiped on Friday October 29, 1929. Prices plummeted, millions lost billions, and the buying boom was over.
The market crashed. It had been preceded, by four days, with a speech by the President of the United States, Herbert Hoover, in which he said, “The fundamental business of the country ... is on a sound and prosperous basis.”

The Great Depression was longer and harsher than previous depressions, which had seen an upturn in business activity after one or two years. But, from October, 1929 until Franklin D. Rooselvelt became President in March, 1933, the economy just went from bad to worse on an almost monthly basis. Banks, factories and stores failed and unemployment soared. Millions of people lost their jobs, savings and homes.

Astrologer Evangeline Adams saw into the future and predicted the crash - along with other events that actually occurred, like Lindbergh’s flight - but didn’t listen to her own predictions. She lost $100,000.

The Great Depression was depressing, indeed!
bumblebee is offline  
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post #2 of 2 (permalink) Old 10-29-2006, 11:23 AM
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Black Thursday was the first sign of the end of a great bull market.

What goes up, must come down. And come down it did. However, Black Thursday was not the nail in the coffin (that comes on Black Monday and Tuesday). In fact, Black Thursday involved a great comeback. Let’s get straight to the story…
12.9 million shares changed hands on Black Thursday (a new record – 4 million shares was considered a busy day back then). Most of the panic took place in the morning hours. The ticker tape machine fell behind by an hour and a half leaving investors madly scrambling to sell their investments without even knowing the current prices. Panic set in. People gathered outside the exchanges and brokerages, police were dispatched to insure peace. Rumors were flying. By 12:30 pm, the Chicago and Buffalo Exchanges closed down, eleven well-known speculators had already killed themselves and the NYSE closed the visitor’s gallery on the wild scenes below. Reporters learned that an important meeting was taking place at the office of J.P. Morgan and Company, involving many of the most important men in banking. After the meeting broke, Thomas Lamont, senior partner at Morgan – a company founded by a man who had help stop a panic in 1907, made the following statement to newspaper reporters: “There has been a little distress selling on the Stock Exchange… due to a technical condition of the market” and that things were “susceptible to betterment.”

The market moved up a bit after Lamont’s statement, but the real recovery came at 1:30 pm, when self-confident Richard Whitney, vice-president of the NYSE and floor broker of J.P. Morgan and Company, walked into the exchange floor. The crowd went silent. Everyone expected an announcement that the NYSE would be closed. Instead, Richard Whitney surprised everybody…
Whitney asked for the latest bid on U.S. Steel. “195” someone shouted. Then he promptly announced that he was buying 10,000 shares of U.S. Steel at 205. He immediately received 200 shares and then left the rest of the order with the specialist. He continued to make similar orders for over a dozen more stocks. Fear evaporated as investors became worried that they would miss the new boom. The market would have closed much higher if stop loss orders from earlier that day hadn’t been triggered during the upward surge. Needless to say, the recovery on Black Thursday was impressive, but so was the massive sell off earlier in the morning that gave it its name.

Friday and Saturday morning sessions held steady as everyone became optimistic with the market’s ability to recover.
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