The most consequential U.S. event of the 20th century would have to be the Wall Street Crash of 1929. It not only had a country wide effect, but a long term global effect, resulting in a month long economic decline. The crash would later be defined into three phases, Black Thursday, Black Monday, and Black Tuesday.
The decade leading up to the crash was a time of prosperity and wealth. The stock market had experienced plateau highs, and there was increasing speculation that it would continue along this path for the long term. More and more individuals saw the stock market as a good long term investment, and increasingly invested money in the market. The market was seen as such a good investment that borrowing money to invest was becoming increasingly common. At the time of the crash over 8.5 billion was out on loan, more than the amount of currency being circulated in the entire United States. Brokers were routinely lending small investors up to 2/3 the face value of the stocks they were purchasing. As a result, stock prices were rising which encouraged more people to invest, creating an economic bubble.
Black Thursday happened first, on October 24th, 1929. The market finally turned down and investors began to panic. In order to ease investors fears, a group of major banks (Morgan Bank, Chase National Bank, and National City Bank) got together and purchased a large block of shares in US steel. They also purchased similar blocks of other “blue chip” stocks. To no avail, on Black Monday, more investors decided to get out of the market, causing stocks to slip further down with a record loss in the Dow that day of 13%. On Black Tuesday, amist rumors that president Herbert Hoover would not veto the pending Hawley-Smoot Tariff bill, the stock market plummeted even more. Approximately 16 million shares were traded that day, a record that had not been broken in nearly 40 years in 1968. The Dow lost another 12% that day. The market lost 14 billion in value that day, bringing the week total losses to 30 billion, ten times more the the U.S. annual budget, more than the U.S. had spent in all of World War I.
