and the City season now on bbc2 was this the greatest financial lessons
we chose to ignore me I'm
con in 1929
years a booming prosperity ended in catastrophe
it was the biggest stock market crash since records began
on it is impossible to underestimate the shock
a census stunned disbelief do first-time investors borrowed huge amounts of money
to speculate on the Mount the market broke very sharply and Milana people who
were wiped out with it
it was very painful
later thousands have banks failed millions lost everything
the poverty which really all
around us at least really really pitiful
but the crash was followed by a depression and spread across the world
lasted for a decade and was a prelude to war
I'm this is a story of a financial disaster
we hoped it would never happen again on
with Tuesday 23rd October 1929
without warning share prices are plummeting on the New York Stock
Exchange
in investors a stop in
for the last five years the market has only gone up
in the space of an hour a staggering two and a half million shares are sold
the next day the downward spiral continues
yeah as people came in to trade stocks on October 24 there was a sense that
maybe something had changed it there was something different
all the Sun there just weren't hires
people willing to sell but there are buyers coming forth to buy the stocks
and prices began to fall two dollars four dollars
ten dollars a share the serbs were fine
that morning there were drops on the stock change
they were so shocked and so dire stock suddenly dropping ten twenty thirty
points at the time
that it said that there were shrieks and gasps
in the gallery the New York Stock Exchange
people are stunned by what has happened
and terrified shaw's injured people
begin to gather outside the stock market 10,000 people
Faith Hill the streets from Broadway to the east river
people want to know what's going on they went there
these huge crowds gathered around the stock exchange around the statues in on
the stairs
waiting to get any kinda news they could as people came out
at the exchange they could hear voices they could actually hear the shouting
and yelling is people are buying and selling
that they didn't know what was going on in today gathered and they stayed there
to find out mu
few of the thousands waiting in the crowed appreciated the scale of the
disaster that was about to unfold
law could imagine that over the next five days
a financial catastrophe would sweep away the foundations of america's prosperity
on
but to understand what brought about the crash we need to go back a decade
to a time when American confidence grew so high but it seemed the good times
would last
should have askin
in and in 1919 the US it emerged victorious from World War one
and mood of optimism was in the region
Britain and its European allies would exhausted financially from the war the
US economy was striving
in the world danced to the American church in
the uncertainties moreover
there seems little doubt about what was going to happen america was going on the
greatest
guardians spree in history and there was going to be plenty to tell about it
thin
in the 1920s everyday life was changing electrification
transform demand tones were hooked up to the clinton
new technology is unmatched in airplanes radios
domestic goods that it started life as luxuries now became necessities and
the cattle industry also who dis people flock to buy one of the new Ford or
Chrysler automobiles
a and you know I love boneless prosperity
seem to have begun and theme
this is the flowering of consumer culture and mass consumption
on a scale never before seen okay
there was also heavy installment buying to encourage people
to buy big-ticket consumer items that they can buy those items on credit
this type of consumer credit was another innovation in the 1920s
for the first time the idea of buying okay later
hit the mainstream and and there's a kind of
play culture that develops alongside
this consumerism which says we believe now in instant gratification
take care of the now don't worry about the future
live for the moment in
it was a whole ideology that we're in a new economic era
and it was the birthright of every self-respecting American
to be rich on
with easy credit and more disposable income americans are now looking for new
ways to get even richer
on since world war 1 the US government had sold bonds
known as Liberty Bonds to pay for the war this was a way to borrow money from
the public
who in turn would receive interest payments on the bonds volume
celebrities such as Charlie Chaplin and Douglas Fairbanks
had been recruited to promote them that huge rallies Liberty Bonds
cause many people to become investors in securities for the first time
for the first time in their lives they got interest payments every six months
and the security was something they could trade on the market so they could
look in the newspaper and see what the price is my bond is today
Liberty Bonds created in investing culture most people have never purchased
securities before any guide ordinary
people accustomed to buying securities
you
now there was another group of people who thought they could take advantage of
this new investing culture
the bankers on Wall Street
three years wall street's the Central American Finance was made up a small
elite group banker's doing business with each other
in a society closed off to the general public
but one man saw an opportunity that would change the face
on the financial world Charles Mitchell
president at National City Bank spotted a lucrative the gap
and Mark &
Metro saw that investors had purchased a lotta government bonds during world war
one
and so he said now we have an investing public they're all we need to do
as market other products like corporate bonds common stocks and just tell people
these are respectable investments Mitchell was a natural salesman
with a big ambitions I'm if people willing to buy bonds to raise capital
for the government
surely they could be tempted to buy stocks and shares
to raise capital for private companies listed on the New York Stock Exchange
and you could make a profit for themselves in the process
gradually people who never dreamed that they would invest in stocks were doing
so
when stocks lost ladder this stigma historically
stocks have been considered much too risky for ordinary people
her wares in the nineteen twenties there was a sense that
investing in stocks was not only safe but reliable and respectable
the idea to cough and to exploit this lucrative new market
Mitchell open brokerage offices all across the country
where people who have the money but not the investment know how
could speculate in stocks and shares cool
this speculative frenzy
embraced all kinds of people not just professionals
ordinary people began participating as well in on
crushing and numbers were all across the country not just New York City
but in cities and small towns all across America
people who are in love with the stock market
technology made it all possible the leadership prices flash from wall street
could be printed out for the minutes across america
using telegraphic ticker tape machines yeah
you could find ticker tape in nightclubs
in railroad depots in beauty parlors
on ocean liners the market became a pervasive part of america's
play culture in nineteen twenties I eat
sleep dream talk stocks the only way I believe to make money
it's exciting I'm not be seventeen thousand dollars profit
on three and a half thousand dollars capital not bad
yeah
who were wild speculation
all kinds I'll securities movie company stocks aeronautical stock small the auto
company stocks
one other hot stocks in the 1920s Radio Corporation of America
was a lot like today's Google you know it was at cutting edge technology
they have this idea that you could put radios in cars an action that
the American investing public began to connect with
products they were using that were coming from corporate america
with the the the notion that hey I might own a share of the company that makes
their product that I like
aren't you have my own room
my not money here I'm
you're done
amo
you
lonely man my the mid-twenties around three million Americans within the
market
on wall street. grip the public imagination with tales of fortunes be
made overnight
the ideal the great bull market in who she is only seem to glomp too cold
I
every popular magazine every newspaper every radio station
was fascinated by what was going on in the stock market
people charted the activities to celebrities like Charlie Chaplin a
Groucho Marx in
were fascinated by what stocks they happen to be speculating in her room
young comic had to go to marked invested all his savings into the market
it was so pleased with his profits on paper that he persuaded his brothers to
invest to
one easy racket RCA went up some point since this morning
I just made myself some thousand dollars in
I 0
but it wasn't just celebrities becoming speculators the big Wall Street
speculators
will become the celebrities themselves to home
they were thought of as creative entrepreneurial and bringing wealth
Domenico
joseph kennedy's father that the future president kennedy
was one in this new breed of shoes financial superstar home people work
session a day because
some love these men like joseph kennedy ordinary folks they were men from
nowhere
and their rapid rise on the market I
was a kind of inspiration to ordinary folded that
might even be possible for them someday all I stories circulated anyone from
bell boys to bob's
could make easy money on the market the shoeshine boy on wall street.
had Bologna was one of those inspired by the steals a rags to riches
n who was going to make a fortune cool
that he lived in New York the stock market was Kingwell
my father was probably about seventy to eighty
on a daily basis he would china shoes a problem literally up the great men of
America
people might Joseph Kennedy key executives like Mitchell
he would converse with them and became somewhat of an expert on things like the
Federal Reserve and
things you wouldn't think that a shoeshine who would be expert on but he
was talking to the great minds above Wall Street
everyday whole day and so is my father began to invest in the stock market
is the truth be told I learned how to read
meeting the stock pages because that was what my father did I mean we grew up
with the stock market was the stock market for preface it was the stock
market for dinner when he came home
I the stock market was was the world
I started 1928 I because like many young people
I want you to go to the place where there is making all this money
my first job these to be a messenger boy
on for the change a colonial we could to find out
that most the time people like green tea
Laura there
the
people had so much faith in the bull market that they borrowed increasing
sums of money to speculate on rising share prices
this way of buying shares was known as buying on margin
the investor was required to put on only part of the money
with their broker funding the breast
the culture of I know pay later and spread to the stock market
buying stocks on margin means essentially that you're buying in with
borrowed money
the by the late nineteen twenties ninety percent of the purchase price of the
stock
is being made with borrowed money there were no rules about how much you could
borrow and people borrowed enormous sums of money to buy stocks
you could buy a hundred dollar stock for twenty-five dollars
and then in and a brokerage firm would loan you the other 75
and if the stock went up in the late twenties
everything seemed to go up and up the net twenty-five dollars could turn into
investment officer 200 or 300
so it became a huge part in the US economy to loan money
for the stock market in fact and in the late 1920s nearly forty cents and
every dollar loan it was for stocks in
this my last influx a borrowed money into the stock market
created more demand for shares pushing prices
ever to Prince in 1928 the market went up by almost 50 percent in just 12
months
and the stocks continue to rise more and more investors borrowed money to get a
piece of the action
one of them shoeshine boy at Bologna
my home didn't have a lot of money in the stock market
he told me at the time he had about six thousand dollars in cash
for number six thousand dollars in cash translate into a lot of stock
P course in those years you've only had to put 10 percent down from March's
so it's six thousand dollars you could have sixty thousand dollars worth of
stock
in
Wall Street was hungry for new
come to us there was one group would-be investors that the street at all was
ignored
whose money it now won t
him until the 1920s women had play a very small role in the stock market part
of this which was simply gender prejudice they were considered incapable
are the kind of cruel sang fly G it was necessary he speculated in the market
but in the 20s by the popularization on the stock market
included shoes numbers have winning
when the twenties were big time for women anyway they
really stepped out on their own they began to take control of their own money
they went to college actually in record numbers in the nineteen twenties
and I as they did that they also got interested in the stock market and is
wait for them to build their own wealth
%uh one such investor was a pioneering New York photographer
called Alice Austen she lived in Staten Island
just across the water from wall street she had moved into this house when she
was a couple months old
she was Brighton she was adventurers
by the time she was 11 she had received a camera which was a new invention by
the time
this immediately took to it over the years she took some
8,000 glass plate negatives making her one of america's
earliest and most prolific photographer trashed policies inheritance from my
grandfather
had fun in a comfortable lifestyle but it had dwindled by the nineteen twenties
and she was tempted by wall street's promise some quick fuck
Silas Austin discovers that she is running a little low
and the question then becomes what to do her friends
0 urged her to be conservative cuts in spending
maybe not go to your maybe not by a car instead to Alice found a broker
who advised her know I'll buy stocks become rich quick
and you know what you can borrow money so you can buy even more stocks
buying on margin and Alice Austen thought that pay
sounds like a good idea to me on
throughout the story market in the nineteen twenties the republican party
state in part on the back up america's increasing prosperity
on
calvin coolidge became president in 1923
an investor himself he was notably silent in the speculative mania gripping
Wall Street
calvin coolidge typifies the lazy a fair devil-may-care
a recklessness %uh the 1920s
he's famous for saying that the business is america is business
you it was a prosperous period business was making money Wall Street was making
money
now the politicians I think just said well every everything's fine
the economy's growing the market takes care of things pretty well in the
government's job was to get on the way
are the
during the coolidge presidency wall street's Park continue to grow
unchecked this administration had close links with an elite group of bankers and
financiers
wall street's inner circle I
their wealth and connections gave them a men's influence over the government's
financial policy here
the small a lead private partnerships this was really the royalty
far wall street these were very mysterious and discreet places
they were small firms with limited capital but they exercised really
and outsized power
the most prestigious if these elite films was the JP Morgan Bank
strategically located directly opposite the stock exchange
it would play a key role in events to come a senior partner GP Morgan
Thomas Lamont was the most powerful man on wall street.
his influence extended well beyond New York
the amount and the other JP Morgan parton's
spoke regularly with successive presidents grandfather was a very very
busy man
he didn't have to time as some grandfathers might to
take his grandson Tyler baseball game or
go fishing and do things like that on
grandfather's life style certainly a very handsome lifestyle is no question
about it
he did have his yacht the run at which was a 72-foot
very handsome yacht which you often would cruise down from his house in
palisades
commuting by boat if you will down the Hudson River to wall street name look up
to the bank
the more
under lamont leadership JP Morgan steered clear to the worst excesses %uh
the stock market
but the close relationship between elite bankers and politicians
helps keep government regulation Wall Street
to a minimum while amateur speculators were transfixed by the soaring value of
that investment
they were hopelessly unaware how wall street
really worked no
with little government supervision the market was a law unto itself
and insider dealing was right
there was a lot of market manipulation going on was rampant there was no
disclosure doll to speak up
and when Wall Street was very small and very self-contained
that was probably OK that is people like you and me began to put our hard earned
money into the market then it really mattered
I'm the stock market in the 1920s
was neither fair nor democratic it was a big gambling casino and it was rigged by
professional
speculators home
green
good
has small investors gambled with their life savings
the failed to realize that the odds were stacked against them
men like joseph kennedy did not make their fortunes by simply picking the
right stocks
the truth was that they were cashing in on the naive the TL gullible newcomers
die bunch sharp speculators would get together
and coordinated fashion they would start quietly but relentlessly buying
in individual stocks
what they would do is hype a particular stock buy it up themselves
and then dump it on the market so that they took the profits
while the average investor in those stocks were left with the loo 6
even some love the a lead investment houses on wall street. were
engaged in this type of market manipulation
ass
in march in 1929 a new Republican President Herbert Hoover
was inaugurated in his address he reassured Americans
we have reached a high degree of comfort and security
than ever existed before in the history of the world
but behind the scenes he was less confident
hoover is actually skeptical about what's going on
on wall street in the economy generally but he doesn't have the political
courage of his convictions
and so when he becomes president
he does nothing to reign in this wild speculative fervor
he doesn't do anything to encourage the federal reserve with the Treasury
to tighten up margin speculation the stock market
on in private gruver talk to ban
orgy of speculation but like his predecessor coolidge
he had no appetite for regulation of the marketplace
I'm yet who was not alone in his fears
but the stock market bubble might be about to bust
0 days after the inauguration speech a prominent and highly respected banker
Paul Wohlberg
broke ranks with the wall street aristocracy and issued a public warning
the orgies oven restrain speculation are permitted to spread too far
the ultimate collapse is certain to bring about a general
depression involving the entire country I'm
my great grandfather issued a warning in march of nineteen twenty-nine
the actual use the word %uh a depression
and he was shouted down I think he was disregarded he was
you know a party pooper I mean no no everything's fine
that everybody's making money and having a good time at the party
so when there's a good bull market going on
the person who says this might be getting overvalued you better be careful
he sir dismissed overall for live at me
he may mean nothing but a good time ttyl
being no I don't know in 10
long boats prediction fell on deaf ears and between May and September 1929
60 new companies were floated on the New York Stock Exchange
adding more than a hundred million shares to the marketplace
fueling the investment bubble I where
you hear the same things in every bubble
this time is different it to differ financial world it's a new financial
rules in fact Groucho Marx
went to his broker at some point today I just understand how these prices just
keep going up
in the broker said to him well you have to understand
it's a global economy now and this was 1928 1929
she I think I've heard that sometime since then some professional speculators
sense that the market was overheating
the more astute good out during the summer one day apparently Joe Kennedy
according to Joe Kennedy
later recollections he said if the shoe shine going knows as much as I do about
the stock market maybe it's time for me to get out
in September the market became increasingly volatile
behind closed doors president who is on the lease was grueling
herbert hoover they keep making enquiries among his wall street rans
asking if he should be concerned and he received a memo from Thomas to be Lamont
who is the senior partner
and JP Morgan & Company on grandfathered sat in that letter
the market will correct itself and it doesn't appear to the would not appear
to be any need for any kind of government intervention in the market
who
le monde reassuring hoover that there was absolutely
no cause true concern and the memo
intended but a line the future appears brilliant
Co
five days later
the stock market crashed the rule
no one knows what triggered the sudden loss of confidence
that happened at the end of Wednesday 23rd October
but I would have no way who shop for an automobile stocks provoked a frantic
last hours trading
0 millions shares was suddenly sold
the the next day the Great Crash of 1929
began on 0
them
October 24th 1929 black thursday is often considered to be the beginning of
the crash
there was really a tremendous drop was scared a lot of people
I'm
it is impossible to underestimate the shock
a sense of stunned disbelief people panic
is the market just drops ten drops in drops
the desperate for news thousands gathered outside the stock exchange
the tremendous crowd standing there barry grimly staring had man who
I just been wiped out city officials are so alarmed by the edge
that they send 400 Mounted Police cheering that there's going to be a kind
of
bash deal like invasion I love the stock exchange
and it said that there was a strange
murmur in the air that there is a very very strange kind of haunting sound
which must have been the cumulative
rice is a beloved these people sharing their concerns
the popular reaction is one helluva
this can't be happening go
a visitor from Britain was there that day too you
winston churchill had invested much of his own money in the US stock market
and had decided to pay a visit done
I happened to be walking down Wall Street the worst moment of the panic
the package stranger who recognize me invited me to enter the gallery
on the stock exchange I expected to see pandemonium
but the spectacle that made my eyes was one of surprising
com and cordelia's the 1200 members at the stock exchange
while walking to and fro like a slow motion picture
Novartis stamp and he copper anytime a
enormous block some securities and a third
their own prices
churchill was to lose a fortune in the crash that day
in
outside the crowed continue to wait for news
rumors were fueling the mounting panic in
once the crash is under way the real question becomes
one of confidence when you lose all confidence
in the economy hurting bad go down together
and sold the chief investment elite
used a great pains to try to restore that confidence to convince people that
the economy and the stock market is sound I'm
the bankers knew they had to do something to avert a total financial
meltdown
I'm a Times journalist watched events unfold
I'm
the crowd grew thicker and noisy room
and then there was an Eddie in the middle of the room the man in shirt
sleeves was pushing his way across the street
in the direction of the Morgan office this was Charles the mitchell
chairman of the National City Bank in the post his way into the office is at
the house and Morgan
little later we learn good economic boom
Charles Mitchell had been summoned to a meeting at the office is a JP Morgan
I'm around the table with four other leading bankers
including Richard Whitney vice president at the New York Stock Exchange
these were some of the wealthiest businessmen in america
representing around six billion dollars in assets
chairman was Thomas Lamont
I think it was a great shock to grandfather they did not foresee that
anything like the great crash that took place
what happened grandfather called a meeting
at his office at 23 Wall Street a summer leading bankers in town
and figured out what they could do to support the stock market which was
plunging
what they came up with was a planned to put together a pool $250 million dollars
and those funds would be used to support a key listed stocks
at lunch time Richard quickly marched across the street
back to the trading floor the stock exchange the
really huge injection of the bankers cash Whitney hope to get the market
moving again
Whitney parades over to the desk where US Steel's
being sold and by age twenty five thousand shares of US Steel
at a price well above when it was then selling for
and then makes a a snitch similar prom and i'd
to other blue chip stocks and makes a similar purchased
the idea being we will now restore everybody's confidence in the market
and other great financial Titans have the time including John D rockefeller
make similar purchases
hoping that this symbolic act will
turn the times
and it worked such was the magical power
above the with the name and the Morgan name that stock suddenly turned around
and started to
go up
by now news that the meeting had leaked out and journalists with disputed
information
grandfather was meeting with the group to reporters who were sampled on wall
street outside over his back office
his style was always too stay calm and never say anything
that plugged up cause served with that would erode people's confidence in the
stock market I'm
sober had missed the amount received is with the mana soon reassuring
there was like the man who comes on the stage for burning theater
and urges everyone to keep perfectly cool stating
there is no cause for alarm I'm
there has been a little distressed selling the stock exchange
and we have held a meeting to discuss the situation we have found that there
are no
houses and difficulty and margins are being maintained
satisfactorily the grandfather many others felt that the worst was over
%uh but they were very very wrong
tho over the weekend the bankers intervention seemed to have worked
trading on Friday and Saturday was captain uneventful
president hoover also tried to steady nerves
by repeating a mantra that has been used during market crashes
many times since the fundamental business in the country
that is production and distribution of commodities
is on a sound and prosperous basis within the offices of the financial
district
there was total chaos why things that we forget
is how from into the technology was so many stocks traded on
October 24th but it took four hours for the ticker to Pratt
all at the stock trades after the market had closed
through the taker hopelessly swamped
fell hours behind the actual trading became completely meaningless
all night long the lights blazed in the windows a bit I'll office buildings
where margin clocks and bookkeepers struggled with the
desperate ask are trying to clear one day's business
they will the next they began they fainted at their desks
the weary run afoul exhausted on the marble floors and banks
can slap cool
in
on Monday the stock tickers running over tape panicking investors desperate for
the later share prices
jammed the telephone lines between New York and other major cities
for the first time many speculators were discovering the downside of
easy credit and buying on margin the fairly significant number of people who
are buying stocks in the nineteen twenties were buying good
with borrowed money have course the Wonder
Feb buying stocks with borrowed money his third
the gains I tremendously accelerated and magnified
on the way up and then press on the way down the entire machineries thrown
into rivers and the losses are also
magnified ok
all these people who had borrowed to buy stock now had to put up more collateral
and this was something that had not happened as the market had gone happen
up
you've got twenty five dollars down for a hundred dollar stock but now I the
stock
has dropped on so what happened as the brokerages that email these loans got
very concerned that the loans will be paid back
I'm people got calls to bring in more cash
whether stocks to be sold on account need six hundred dollars
unless there's amount received before 1 p.m. Tuesday
all South all securities in your account consider this not as
to that effect and that's a difficult thing to do some people didn't have
additional cash to bring in
or they are it took him some time perhaps to do it but the brokers were
very uneasy they couldn't wait
in and so Monday did market begins to fall even at a steeper rate than
now on Thursday intact this would turn out to be
wanna be very worst days ever in this in history the United States stock market
the
1929 when the stock market crashed I was very young lady
just seven years old however
I'd kill remember bits and pieces up that day very clearly in my memory
we didn't have many mean for communication
and when something extraordinary happened the papers but put out an extra
as that that's what it's called extra to such
and a little boys in a little P caps would come running through the streets
screening extra extra read all about it
and invariably he somebody in the house would go down and buy a daily for 2
cents and then we would know what happened
and that's how we found out about the crash at the time
me it was with a family friend but news came that the friends and
had lost everything the lady was crying
quietly shoeless prying quietly
and wringing her hands and wringing hands and walking from room to room to
roam
show that was my actual memory up that day
Hey
on Tuesday morning some other most famous names in corporate America
so their share price plummeted US Steel
radio General Motors stocks that had been symbols of the boom years
the and Tuesday there were
tremendous waves selling the just kept coming
this time the selling was so powerful
and so relentless there was no lunch time
meeting at JP Morgan clearly the volume and the sales
overwhelmed any possibility the bankers trying to
stemmed the tide way evening Tuesday
all-american stocks were worth about 22 percent less than they were
when the market opened in the morning on Monday
36 hours the last 22 percent of the value of american industry
homer
was president and he and Andrew Mellon
very the Secretary to the Treasury were
way to the ride and felt that it was not the government's
job to interfere with theirs they believed in pure
I'm feathered cap tourism and so they did very little
or nothing to alleviate the crash
major insolvent self
the market broke very sharply and a lotta people were wiped out with it
it was very painful almost everybody lost money as has happened now
bonaparte and I'm dogwood today New York Stock
not find them thing and banking on
drop down a mine be I'm the Packers any
it's estimated that by the end of these five days trading
$25 billion dollars worth of personal wealth
had simply disappear bail you out the stock market continues to sag without
and
have holders in to sell everything that I figure I'll have about 500 left
if I'm lucky play humble ending to a potential profit
not four months ago on nearly a hundred thousand
at least I said to myself I lost all in the greatest panic in history
I was very lucky
I never lost my job I did get a cut
shali progeny by employees you a well-paid people
when they tell me about a shaded I use by Lee
I said I thought you that a fire but he's
those who could afford to face their losses with black humor
I reminded him and
ball me sure why
yeah got yeah
me and me and I home and museum education
yeah in hand million dollars yeah
dollar fan
can the market do came eighth
yeah 10 million do anything I
in detention math
my hand okay and
Canada Keith
yeah me and our way all campaign faith
and down made a math
on another performer who had gambled and lost
was groucho marx his reckless speculation cost him everything he
turned
on
the freezer Alice Austen the photographer from Staten Island
was also typical love those who had been alluded to the market
without realizing the risks basically she loses everything
in 29 30 her counters wiped out
and it comes a shock for
for our saw stern and I don't think she believes it like a lot of people you
just can't believe it
and she thinks all I have to do is to wait a little bit in the market will
come back
and she continued living ass
if she was rich and have she moore gets our source in mortgage to our house
not to pay our bills but because she once again want to take offense a trip
to York
my father lost everything he was losing everything but he was 22
he took it magnanimously you know is
2022 it it it isn't as dramatic the people around him were in poor
go establish people in their fifties and sixties and
we're losing their life savings Werner absolute panic
not everyone coped with their losses although the number of suicides has been
exaggerated
to some it seemed the only way out I know that people read about the stories
on wall street. Cup
people opening the windows in their offices and jumping out that actually
happened that isn't
the urban legend people did commit suicide up into it works only in forty
years on wall street
and had amassed fortunes within appropriated days lost everything
that I'm sorry I was unable to return the two books until now
the conditions down in the financial neighborhood have been such as to keep
us working
cool
yesterday woman jumped from the roof of our building forty four floors my past
our window
they saw her body lying in the street
the cyber so harrowing but I became hap sick
the new
0 the effect to the catastrophic crash in Wall Street
rippled out across america I'm even those who never owned shares
and would never benefited from the stock market boom
became victims to 0 the crash and undermined Americans faith in their
fragile banking system
made up of thousands of small town banks a black
the size a reputation to convince customers that their money was safe
0 as confidence in the economy sank further
a domino effect began in 1931
all the 2000 banks failed 0
after the crash the banks closed
that I think which affected us little are curiously
us many ask the people at my stature and
many people have money in the bank little bit about a couple hundred
dollars
you know thousand dollars maybe there was no infrastructure then there was no
Federal Deposit Insurance Corporation the guarantee people's deposits there
was no way to backup the bank's
so if the banks had made bad choices
you is a depositor paid for you want to go Germany wasn't fair
0 and then people here that the bank down the street wasn't good
and they worried about their own bank in there because a run on their bank in a
bit it became a terrible vicious cycle
0 something like three thousand banks closed in the following
couple of years after that 0 the whole financial system then
seems he need not just unstable but
worthless after that when people save money
they were very leery of banks and money when under the mattress
that
way
the stock market crash of 1929 did not create
the Great Depression but it did start a sequence of events that
eventually culminated with the great depression
well you know it's summer this is gonna sounds sort of familiar
the banks were loaning money for the stock market companies were loaning
money the brokerages were loaning money
and when that does prices fell all that money just disappeared
who almost mediately companies began to feel the patch up not having the capital
and having lost money
and they began to lay off people to let people go to shut down production
there were mass bankruptcies does liquidity crisis on exactly the same
kind we have today
that is shaken all kinds of businesses could no longer get
loans to keep themselves afloat even if those businesses
were entirely solvent they couldn't get the kind of short term commercial credit
to pay their workers to buy new inventory
to pay their suppliers then surely began going bankrupt and as they went bankrupt
they lay people off
and as a lay people off demand fell
and this is what a does traumatic damage
to the whole society so traumatic that its second only to the Civil War
he in Ian in American Memory as a tragic moment in American history
my father had a
minus sized insurance brokerage
agency one night at dinner my father
said that he had a fire an employee
and I i a very cavalierly said well
he'll be able to get a job already and my father said now
he's an older man who is in very capable
and I don't think he can and at that point
my father burst into tears it was the first time I'd
ever seen my father cried
day with such a change in our lives and
all the people around me after the crash
that many of my girlfriends fathers who lost their jobs
and they couldn't Pagerank over a decade
Paul
the poverty which really old around us
men had no clothing they were in rags merely rags they used to wrap their feet
up a newspaper
and put them in Kabul and makeshift shoes to walk around the street
the new and then if you took a walk over to Central Park he saw this big
area a deserted reservoir that had been drained
and they made little hot I've cod black boxes
and they would sleep Gail overnight and they called it hoover they'll
crossed out with the name about president at the time I have crossed
polish
stock market crash in oldest poverty
was across pride in his lap it was
really really pity fell
the like many others the photographer
Alice Austen struggle to keep up mortgage payments
as the Great Depression too cold a few years into the depression Alice Austen
runs out of money
there's nothing left she's out of her house
they take her to a poorhouse
I and it's a poor house on a Dickens novel and she lingers there for a couple
of years
rear rack use the her photographs are discovered
of your photos are sold to time in life magazine
and that earns her enough money to move out at the pourhouse
into a decent retirement home in a sense for photographs
come to her rescue and take a router poverty in
and into year two dismantle the whole world who's who accurately predicted the
crash and the depression
save the bank he ran from disaster by getting go to the market to
time but it was a little consolation to my great grandfather
probably never really recovered his own personal equilibrium
after the crash
to be called because Sandra of Wall Street %uh
I think was very painful for him and with if we all remember
to Sandra she couldn't just see the future she was also doomed
to be disregarded and I think
it cost him to it go into a depression at his own
I'm not sure that he ever would have said
I told you so I think he felt
let it was really tragic. this worldwide
depression could have been averted or headed off for at least
it didn't have to crash so hard and I think
arm it probably a led to his early death
rule
real he died what was the last year
hoover's presidency and there was no end in sight
ass
but in 1932 twelve years a Republican rule came to an end
I Franklin Delano Roosevelt
this all unless flap that I will faithfully execute the office
up President of the United States democrat franklin roosevelt
was elected president in a landslide victory his first task
was to restore confidence there okay yeah
third spared cell
ass seen as a savior roosevelt promised a new deal to the american people
and to regulate the financial system that might be a threat
governmentally love all banking and credit
and investment go there must be an end
both speculation with up people money
do the new president acted quickly
he guaranteed bank deposits and introduce laws forcing bankers to
operate under strict government supervision
do
you
an investigation into the crash was launched by the Senate Banking Committee
Bay it would last more than three years in the 10,000 pages of testimony
blackened the reputation a wall street
the committee's ambitious lawyer turned into a corner challenge the banking
elite
to account for their behavior he calls these bankers to testify
and what is he learned he learns that Charlie Mitchell love National City Corp
had sold stock to his wife to
avoid taxes pitcher Whitney who had so boldly bought stock
on Black Thursday lost money his own in the embargo his brother and imagine
where he began
stealing from customers he ended up in jail
doing time do
the most prestigious bank in america JP Morgan was also found to be far from
clinton's
the hearings uncovered evidence of a list that offered preferential deals on
stocks
two friends in high places including now former president
not only Morgan partners and bargain family members but also prominent
corporate executives and even some politicians calvin coolidge was on the
performance stock list for example
that was a practice that a lot of people fell was wrong
for number core had a great quote he said it was shocking disclosures have
low standards in high places
was I love because you know you could say the same thing today
in response to public outrage at the bankers dirty dealings
president roosevelt set up the Securities and Exchange Commission
its task to clean up Wall Street
at its head he chose a man who knew more about
unethical practice that most president roosevelt
when he introduced the Securities and Exchange Commission to regulate Wall
Street
named his old friend and supporter Joe Kennedy to be the first chairman
and that's putting the box in the chicken coop
the
although roosevelt restored confidence in the banking system
the Great Depression would last until the outbreak of World War two
then there's no the globalized economy meant that the crash in subsequent
depression
ripple does across the world mom
in Britain there was a slump in manufacturing
and millions lost the jobs 0
Germany still suffering from defeat in the first world war
was hit even harder I'll so many people had their life savings destroyed during
the great depression that had created in many countries a desire for some
authoritarian government to that with
save them that would rescue the economy
well no doubt that crash and the depression
strengthened anti-capitalist movements
the communists to take it over in russia and the were rising fascist movements
mussolini was already in power and
and Italy and hitler's political base was growing in Germany
and when american-style free market capitalism
suffered from this Wall Street Crash followed by a depression
it just strengthen those people who wanted to say
there's a better way low mile communism and fascism prospered
many nations put up barriers to prevent free trade
and turned inwards in an attempt to save that economies
the economic nationalism lead to trade wars
and later World War one
eighty years of those who remember the Bubba love the twenties
and the crash that followed feel that they have seen it all before
I don't think we you learn anything from it
I have found that people's memories
a very sure Joe they make the same typable
leverage commitments where they don't look at the downside risk boom
you have a lot of cheap credit in the nineteen twenties now we've had cheap
credit %uh
and people speculated the houses and now the housing bubble has collapsed
you had a heavily leveraged American consumer he's in debt
up to his eyeballs and can sustain that debt the subprime mortgage crisis is a
symptom of that
could in the eighties and nineties sheets in the free market had revived
and as optimism returned many of the financial regulations which roosevelt
introduced
with felt to be outdated and was slowly dismantled
I yet again a lightly regulated market
a load speculation to grow on change it
we are now reaping the whirlwind on that deregulation in that sense were exactly
the same position is people who are
in 1929 when the government turned a blind eye
to what was going on in the financial the what I do hope but I
do think is that the government has learned its lessons
and is trying to take steps that are much more active and much more
aggressive
then what was taken and in the 30s to try and stem
the pain and stem the decline I'm
the hope is that such steps will work
but the lessons from the crash of 1929 our that history repeats itself
the human folly and greed a much stronger forces in financial affairs
than reason and restraint thin
a
theme
pill
getting
prove it