Facts About The Stock Market During The Great Depression
• From the beginning of 1928 until September 1929, the Dow Jones more than doubled, increasing from 191 points to 381 points.
•The more the Dow Jones rose in 1928 and 1929, the more it fueled speculative investment. Thanks to the ability to buy on margin (which, in essence, meant that an investor borrowed from the brokerage house to fund the stock purchase), investors were going crazy.
•In 1929, stock brokers were charging interest rates as high as 20% for investors who wanted to buy stocks on margin, but no one worried about those high rates, because the stock market was rising so quickly.
•On Monday, October 21, 1929, stock prices started to fall, and as people began to sell in massive quantities, the stock ticker fell behind, which caused more fearful selling. On Thursday, October 24, 1929, the stock market plunged again. On Monday, October 28, 1929, the market lost 13% of its value. On Tuesday, October 29 (known as “Black Tuesday”), the stock market crashed – so much so that certain stocks couldn’t be sold at any price.
•By July 1932, years after the start of the Great Depression, the Dow Jones was at just 41 points.