1929: The Great Crash Page #5

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business before the next day began.

They fainted at their desks, the weary runner fell

exhausted on the marble floors of banks, and slept.

On Monday, with stock

tickers running out of tape,

panicking investors, desperate for

the latest 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.

A fairly significant number of

people who are buying stocks in

the 1920s were buying it with borrowed money,

and of course the wonder of buying stocks with

borrowed money is that the gains are tremendously

accelerated and magnified on the way up,

and then of course on the way down

the entire machinery is thrown into the

reverse and the losses are also magnified.

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 up and up.

If you've got 25 dollars down for 100 dollar

stock but now if the stock has dropped.

So the brokerage's that had made all these loans got

very concerned that the loans wouldn't be paid back.

So people got calls to bring in more

cash or their stocks would be sold.

Account needs six hundred dollars, unless

this amount received before 1.00pm Tuesday,

will sell all securities in

your account...

Consider this notice to that effect.

And that's a difficult thing to do, some people

didn't have additional cash to bring in or it took them

some time perhaps to do it, but the

brokers were very uneasy they couldn't wait.

So Monday, the market begins to fall, even

at a steeper rate than it fell on Thursday.

In fact this would turn out to be

one of the very worst days ever

in the history of the

United States stock market.

1929, when the stock market crashed I was

a very young lady, just seven years old.

However, I do remember bits

and pieces of that day

very clearly in my memory.

We did not have many means of

communication.

and when anything extraordinary

happened the papers, would put

out an extra, that's what it was

called, an extra, for two cents.

And the little boys in their

little peak hats

would come running through the streets

screaming "Extra, extra, read all about it!"

And invariably somebody in the

house would go down and buy a daily

for two cents and then we would know what happened

and that's how we found out about the Crash.

At the time, Vera

was with a family friend.

But news came that the friend's aunt

had lost everything.

The little lady was crying quietly,

she was crying quietly and wringing

her hands and wringing hands, and

walking from room to room to room.

So that was my actual memory...

of that day.

On Tuesday morning, some of the most

famous names in corporate America

saw their share price plummet -

US Steel, Radio, General Motors...

stocks that had been

symbols of the boom years.

On Tuesday, there were just tremendous

waves of selling that just kept coming.

This time, the selling was so

powerful and so relentless,

there was no lunchtime

meeting at JP Morgan.

Clearly the volume of the sales

overwhelmed any possibility

of the bankers trying to stem

the tide.

By evening Tuesday, all

American stocks were worth about

22% less than they were when the

market opened in the morning on Monday.

In 36 hours you lost 22% of

the value of American industry.

Hoover was President

and he and Andrew Mellon

the Secretary of the Treasury

were way to the right and felt that

it was not the Government's

job to interfere with this.

They believed in pure

unfettered capitalism

and so they did very little or

nothing to alleviate the crash.

They said it it'll solve itself.

The market broke very sharply and a

lot of people were wiped out with it.

It was very painful.

Almost everybody lost

money as is happened now.

# Oh, the market's not so good today

# Your stocks look kinda sick

# In fact they all dropped down a

point each time the tickers tick. #

It's estimated that by the

end of these five days trading,

$25 billion dollars worth of personal

wealth had simply disappeared.

The Stock Market

continues to sag without end.

Have orders in to sell everything.

I figure I'll have about 500 left,

if I'm lucky.

A humble ending to a potential

profit not four months ago

of nearly a 100,000.

At least, I say 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 in salary,

fortunately my employers were

wealthy people and when they

told me about this they said,

"Why are you smiling?' I said, "I

thought you were gonna fire me. "

Those who could afford to, faced

their losses with black humour.

I am one of the lambs

that Wall Street has shorn.

When I was a little girl,

a patron of art left me a million

dollars for my musical education.

But I thought I couldn't live on

the income from a million dollars,

so I asked all my rich

friends for tips on the market.

They gave them to me and I lost

my million.

Now the only thing I have left

is this chinchilla coat of mine.

From now, on my hands are off the

ticker and on the piano keys.

But if you're lucky enough

to have a million dollars,

hold everything

and don't play the market.

Another performer who had

gambled and lost was Groucho Marx.

His reckless speculation cost

him everything he'd earned.

The fate of Alice Austen, the

photographer from Staten Island,

was also typical of those who had been lured

into the market without realizing the risks.

Basically, she loses everything.

In '29, '30 her account is

wiped out.

And it comes as a shock for

Alice Austen.

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 and

the market will come back.

And she continued living

as if she was rich.

And Alice also mortgaged her house,

not to pay her bills, but because she once

again wanted to take a fancy trip to Europe.

My father lost everything. He was

losing everything, but he was 22.

He took it magnanimously.

When you're 22 it isn't as dramatic.

The people around him were more...

established people in

their fifties and sixties and were losing

their life savings, were in an 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 of people

opening the windows in their

offices and jumping out...

That actually happened, that isn't

an urban legend.

People did commit suicide.

People who had worked 30 and 40 years

on Wall Street and had amassed fortunes,

within a period of days,

lost everything.

I'm sorry I was unable to return

the two books until now,

the conditions down in the

financial neighbourhood

have been such as

to keep us working...

Yesterday, a woman jumped from the roof of

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