The Attempts to Stop the Speculators
During 1929 the public was bombarded with statements of outrage regarding the speculative orgy taking place on the New York Stock Exchange. If the media and respected people in authority say something often enough, a large percentage of the investing public is likely to believe it. By October 1929 the overall revealed opinion in the federal government was that there was excessive speculation in stocks and the market was too high. Galbraith ( 1961), Kindleberger ( 1978), and Malkiel ( 1996) all clearly accept the assumption that the market was too high. The Federal Reserve Bulletin of February 1929 stated that the Federal Reserve would restrain the use of "credit facilities in aid of the growth of speculative credit."
The U.S. Senate adopted a resolution stating that the Senate would support legislation "necessary to correct the evil complained of and prevent illegitimate and harmful speculation."
The president of the Investment Bankers Association of America ( Trowbridge Callaway) gave a talk in which he spoke of "the orgy of speculation which clouded the country's vision."
John Kenneth Galbraith wrote ( 1961, pp. 16-19), "The mass escape into make-believe, so much a part of the true speculative orgy, started in earnest."
Adolph Casper Miller, an outspoken member of the Federal Reserve Board from its beginning and an influential member in 1929,