The Great Myths of 1929 and the Lessons to Be Learned

The Great Myths of 1929 and the Lessons to Be Learned

The Great Myths of 1929 and the Lessons to Be Learned

The Great Myths of 1929 and the Lessons to Be Learned


Bierman takes a fresh look at the "whys" of the great stock market crash of 1929, analyzes the economic situation, and presents sound explanations for the initial decline that are not dependent on the assumption of overvaluation. This book challenges the "facts" and overturns previously held notions to reach a dramatically different conclusion from most widely read books on the subject. Was there reason for optimism in 1929? Was it a "Bubble"? Did the high level of stock market prices jeopardize the nation's prosperity? What about the Crash of 1987? Bierman believes that a more complete understanding of these and other questions can enhance current market decisions and allow for wiser forecasts of future market trends.


Senator Glass: "Mr. Whitney, right on that point may I ask you a question: What percentage of the public is [sic] speculating in stocks of the stock exchange understand the real intrinsic value of the stocks in which they deal?"

--Hearings before the U.S. Senate Committee on Banking and Currency on stock exchange practices.

Admittedly, it is preposterous to suggest that stock speculation is like coin flipping. I know that there is more skill to stock speculation. What I have never been able to determine is--how much more?

--Fred Schwed Jr., Where Are the Customers' Yachts?

The year 1929 stands out as the most significant year of the decade of the 1920s. In the minds of most people the year 1929 marks the crash of the stock market, the beginning of the Great Depression, and the end of a ten-year period of prosperity that exceeded anything the United States had ever known.

In 1955John Kenneth Galbraith published his very readable and enjoyable classic The Great Crash, 1929. A reader of that popular book might well conclude that it would be foolhardy for someone to retrace the same path. And it would be; but I will follow a different path and arrive at a different set of conclusions.

This book considers the economic situation in 1929 and the events leading up to the stock price declines in October of that year. It concludes that the 1920s were a wondrous period of economic prosperity for the United States, and that in 1929 it was . . .

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