Like all outbursts, this one was preceded by indications that were ignored. And as in all crises, there was a climax that day that will be remembered by history as “Black Thursday.”
That fateful October 24, 1929, all the expansion that had occurred after the first great war was shattered. Before the night, eleven financiers committed suicide. Millions of people saw their savings and wealth vanish.
The signs that preceded this great depression were written in block letters.
The share price had doubled. Some took out loans to invest in the stock market. The effervescence created a bubble. There were the symptoms of a recession in the world economy, causing many investors to pull out. Soon the rumors were precipitated on the flimsy emotionality of the speculators. Fear infected everyone with fear. Prices began to collapse.
The prosperous US economy had been thrown out of balance by excess consumption. Stocks grew at the rate of unemployment.
When the New York Stock Exchange finally crashed, the effects spread around the world. More than 13 million titles were trading down, there were no buyers. Investors who had gotten into debt were broke, they could no longer pay their loans. 30 million unemployed people rummaged through garbage cans in search of something to eat.
In a few days 600 banks went bankrupt. Later, they were almost 3,000.
And as in all cataclysms, the world got used to its effects, time healed the wounds, Roosevelt launched his New Deal. Then came the second war and the cycle started again, again.
History shows us the repetition of periods of: prosperity, expansion, consumption, speculation, exacerbation of capacities. Omnipotence. Crunch of existing structures. Denial. Implosion Depression. And start over.
What is the reason that men have not been able to capitalize on the experiences of their ancestors?
Maybe they need to live them, even if they know the result, to start over.
You like me? Share it!