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Good-bye To Everything!
For the first half hour on that fateful Thursday, stock prices were steady.
August 1965 | Volume 16, Issue 5
“What do you think it means?” Vanderlip shot back.
“Mr. Vanderlip,” Smith gasped, “I’ve only just arrived in New York and I’ve got only ten bucks to my name as of the moment. I not only don’t know what it means—I don’t even know what it is!”
Vanderlip chuckled grimly. “The fact of the matter is that I don’t know what it means either. My friends don’t know what it means and probably nobody knows iust what it means.”
For many, the big collapse was all too real. David Korn, proprietor of a coal firm in Providence, Rhode Island, dropped dead while looking at a ticker on Tuesday afternoon. In far-off Valparaiso, Chile, a broker shot himself. But contrary to myth, there was no vast upsurge of suicides. The number of self-inflicted deaths in New York was actually lower in the autumn of 1929 than in that of 1928 (37 vs. 44). There were especially few suicides on Tuesday or the days immediately following.
Incredible as it seems in retrospect, there was still hope that the market could come back. The New York Times ’ Wednesday headline declared: “ RALLY AT CLOSE CHEERS BROKERS .” U.S. Steel announced a one-dollar extra dividend. Most Wall Street firms declared that the bottom had been reached, and sent out thousands of customers’ letters exuding optimism. Julius Klein, Assistant Secretary of Commerce, took to the radio to remind the country of “the fundamental soundness of the great mass of economic activities.” From Pocantico Hills, ninety-year-old John D. Rockefeller announced: “Believing that fundamental conditions of the country are sound … my son and I have for some days been purchasing sound common stocks.”
Eddie Cantor unwittingly caught the “air holes” in these hopes with his wisecrack on the Rockefeller statement: “Sure, who else had any money left?” Although the market rebounded 31 points on Wednesday, the big Bull was dead on his feet. With a few feeble rallies, stocks slid down, down until November 13, when the low for the year was reached. On that doleful day, the New York Times industrials stood at 224—almost exactly one-half the high of the year, 452, on September 3. Stocks fell an awful 82 points in the two weeks following the Rockefeller statement.
Several big plungers despaired during these bitter weeks. Robert M. Searle, president of the Rochester Gas and Electric Corporation, ex-office boy of Thomas Edison, took gas. He had lost $1,200,000. In New York, James J. Riordan, president of the County Trust Company, shot himself in the head. More numerous than the suicides were embezzlements. Charles E. Heitman, bookkeeper for Mackie Hentz & Company, was arrested for embezzling $209,000. He had lost it all, plus $75,000 of his own money. In Flint, Michigan, five officers of the Union Industrial Bank confessed to looting their reserves to the tune of $3,529,000, all gone the way of so many other paper millions. In Camden, New Jersey, a judge gave Samuel E. Worthington, twenty-eight, an officer of the Broadway Merchants Trust Company, only five years instead of ten for losing $75,000 of the bank’s money in the market, “because stocks offer a great temptation to people to gamble.”
Rumors of ruined millionaires spread everywhere. Michael J. Meehan, the genius of Radio’s rise, tried to scotch tales of his doom by cockily announcing to his office manager: “Jack, I understand I’m broke. Guess we’d better give all the boys in the office a two weeks bonus to prove it.” But Meehan would be driven from the Exchange as a pariah a few years later for manipulations that in the days of the Bull would have been greeted with admiring cheers. Samuel Insull, mightiest of the utility magnates, opened his twenty-million-dollar Chicago Opera House in November, after grandly guaranteeing to back the margin accounts of all his employees. In the mid-thirties he would be dragged off a dirty freighter near Greece and hauled back to Chicago to tell a jury how he had robbed Peter to pay Paul in a vain attempt to save his crumbling empire.
Optimism would continue to gush from Washington and Wall Street, but the nation’s economy had received a stunning blow. Thirty billion dollars—an amount equal to America’s entire bill for the First World War—had been annihilated. Though there would be rallies, nothing like the 1929 Bull would reappear on Wall Street for a long time. Nor would the prosperity it had so blithely encouraged be seen again for a grim decade. There were some who recognized the truth early. On November 3, L. H. Robbins wrote a wry ave atque vale in the New York Times: