The COVID pandemic has caused the gap between the ultra-wealthy and the rest of us to grow larger than it ever has been before. Thanks to the hyperinflationary policies of the Federal Reserve and our politicians in Washington, stock prices have soared to unprecedented heights in recent months. This pushed the wealth of the uber-rich to dizzying heights, but for the rest of the country 2020 was an unmitigated nightmare. As I have discussed previously, one survey found that 2020 was a “personal financial disaster” for 55 percent of all Americans. More than 110,000 restaurants shut down permanently last year, Americans filed more than 70 million claims for unemployment benefits, and tens of millions are potentially facing eviction in 2021. But even though we are mired in the worst economic downturn since the Great Depression of the 1930s, those at the very top of the economic pyramid are laughing all the way to the bank.
Poster Comment:
In terms of the Great Depression we have not even seen the October 1929 Wall Street collapse. Then comes two years of recession and then the foreclosures and bankruptcies that cancel Unpayable Debts. And we are nowhere near the inflation rate of 1923 Germany. The worst is yet to come but it will come quickly unlike 1933 America which was 4 years in the making.
Selling intensified in mid-October. On October 24, "Black Thursday", the market lost 11 percent of its value at the opening bell on very heavy trading.[11] The huge volume meant that the report of prices on the ticker tape in brokerage offices around the nation was hours late, and so investors had no idea what most stocks were actually trading for.[12] Several leading Wall Street bankers met to find a solution to the panic and chaos on the trading floor.[13] The meeting included Thomas W. Lamont, acting head of Morgan Bank; Albert Wiggin, head of the Chase National Bank; and Charles E. Mitchell, president of the National City Bank of New York.[14] They chose Richard Whitney, vice president of the Exchange, to act on their behalf.[citation needed]
With the bankers' financial resources behind him, Whitney placed a bid to purchase 25,000 shares of U.S. Steel at $205 per share, a price well above the current market.[15] As traders watched, Whitney then placed similar bids on other "blue chip" stocks. The tactic was similar to one that had ended the Panic of 1907, and succeeded in halting the slide. The Dow Jones Industrial Average recovered, closing with it down only 6.38 points for the day.[citation needed] The trading floor of the New York Stock Exchange in 1930, six months after the crash of 1929
On October 28, "Black Monday",[16] more investors facing margin calls decided to get out of the market, and the slide continued with a record loss in the Dow for the day of 38.33 points, or 12.82%.[11]
On October 29, 1929, Black Tuesday hit Wall Street as investors traded some 16 million shares on the New York Stock Exchange in a single day. Billions of dollars were lost, wiping out thousands of investors. The next day, the panic selling reached its peak with some stocks having no buyers at any price.[17] The Dow lost an additional 30.57 points, or 11.73%, for a total drop of 23% in two days.[18][19][20][21]
On October 29, William C. Durant joined with members of the Rockefeller family and other financial giants to buy large quantities of stocks to demonstrate to the public their confidence in the market, but their efforts failed to stop the large decline in prices. The massive volume of stocks traded that day made the ticker continue to run until about 7:45 p.m.
Dow Jones Industrial Average on Black Monday and Black Tuesday[22] Date
Change % Change Close
October 28, 1929 −38.33 −12.82 260.64
October 29, 1929 −30.57 −11.73 230.07
After a one-day recovery on October 30, when the Dow regained 28.40 points, or 12.34%, to close at 258.47, the market continued to fall, arriving at an interim bottom on November 13, 1929, with the Dow closing at 198.60. The market then recovered for several months, starting on November 14, with the Dow gaining 18.59 points to close at 217.28, and reaching a secondary closing peak (bear market rally) of 294.07 on April 17, 1930. The Dow then embarked on another, much longer, steady slide from April 1930 to July 8, 1932, when it closed at 41.22, its lowest level of the 20th century, concluding an 89.2% loss for the index in less than three years. [23]
Beginning on March 15, 1933, and continuing through the rest of the 1930s, the Dow began to slowly regain the ground it had lost. The largest percentage increases of the Dow Jones occurred during the early and mid-1930s. In late 1937, there was a sharp dip in the stock market, but prices held well above the 1932 lows. The Dow Jones did not return to the peak closing of September 3, 1929, until November 23, 1954.[24][25][26]