The Stock Market Crash of 1929 – Part 1: To The Moon!
Jan 14, 2022
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Discover the fatal infatuation of the American public with the stock market in the 'Roaring 20s'. Learn about one debauched day trader, Jesse Livermore, who foresaw the Wall Street Crash of 1929. Explore the economic consequences of World War One on Germany and America. Delve into the thriving era of the 1920s, Henry Ford's impact, and the allure of stock market investments. Unveil the rise of stock market optimism, fueled by iconic financiers and fortune tellers, leading to the historic crash.
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Quick takeaways
The 1929 Stock Market Crash devastated global economies, vanishing $30 billion in wealth in a week.
Jesse Livermore's rise from banned trader to Wall Street figure exemplified financial market volatility.
The prosperity of the 1920s fueled by technological advancements and consumer culture led to widespread stock market speculation.
Deep dives
Discovering Stock Market Crash of 1929
The stock market crash of 1929, a pivotal event in American and world history, witnessed the economic devastation that unfolded during one week in October 1929. With $30 billion in wealth disappearing rapidly, panic struck the heart of New York's financial district, triggering a domino effect that reverberated across the United States and beyond. This catastrophic event marked the onset of the Great Depression, leaving lasting socio-economic trauma.
Jesse Livermore's Stock Market Ascendancy
Jesse Livermore, a self-made millionaire, exemplified the highs and lows of stock trading. From being banned at bucket shops to becoming a renowned figure on Wall Street, Livermore epitomized the volatile nature of financial markets. With a blend of intellect, instinct, and calculated risks, Livermore navigated the turbulent waters of the stock market, experiencing both financial triumphs and bankruptcies along the way.
Rise of the American Prosperity in the 1920s
The 1920s marked a period of unprecedented prosperity in America, fueled by technological advancements, consumer culture, and the rise of the automobile industry. Radio broadcasts brought entertainment and information into homes, while the concept of buying on credit revolutionized consumer spending. The economic landscape in America was characterized by exuberance, optimism, and a belief in endless growth.
Margin Trading and Stock Market Viability
The surge in stock market speculation was fueled by margin trading, where investors could leverage borrowed funds to amplify their gains. While this method promised substantial profits during the bull market, it also exposed investors to significant risk. The vast majority of Americans, enticed by the promise of quick riches, plunged into stock investments without a comprehensive understanding of the market dynamics, setting the stage for a devastating financial collapse.
Jesse Livermore's Personal Life and Investments
Jesse Livermore's marriage to Dorothy, known as Dazi, reflected his ambitious and risky nature. Despite marrying at the St. Regis Hotel in 1918, Jesse's infidelity and love for making money on the stock market took a toll on their relationship. He prioritized trading and pursuing women over his marriage, driving a wedge between them. Dazi's coping mechanism with his affairs led to alcohol addiction, creating a cycle of dysfunction in their marriage.
Evangeline Adams and the Stock Market Prediction
Evangeline Adams, a renowned fortune teller, capitalized on predicting the stock market's future, attracting famous clients like Mary Pickford and Charles Schwab. Her accurate forecasts and newsletters on market trends made her a sought-after advisor. As the 1920s boom led to unprecedented stock market prosperity in America, Adams' predictions contributed to the widespread belief in continual financial success, despite underlying warning signs of an impending crash.
One of the worst financial disasters in history unfolded on Wall Street in late October of 1929. Within a week, 30 billion dollars had disappeared into thin air, leaving the global economy in tatters and heralding the beginning of a worldwide Depression. But what exactly happened? And why? In Part 1 of this 3-Part series on the Wall Street Crash of 1929, we discover how the American public became fatally infatuated with the stock market during the “Roaring 20’s”; and how one debauched day trader – Jesse Livermore – saw the whole thing coming.
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