“Could the 1929 crash have been avoided?” Sorkin asks. “The short answer is yes. There were plenty of opportunities to arrest the forces of speculation before they got out of hand. The long answer is that it would have taken almost divine prescience to look beyond the short-term incentives for making money and focus instead on the long-term consequences.” The crash came because shares were volatile all year. The fear of missing out on the opportunity to buy tipped into the fear of missing out on the opportunity to sell.

 

What Reliving the 1929 Crash Tells Us About Today’s Stock Market

In 1929, Andrew Ross Sorkin re-creates the euphoria and mania that led to the most famous stock market slump in history.

By Gary Sernovitz