October 16, 1929: Before the Wall Street Crash

A few weeks before the Great Crash, newspapers across America published encouraging financial predictions by Yale Economist Irving Fisher. Contrary to the doom and gloom conjecture of his peers, Fisher proclaimed the country was on course for an economic upturn, rather than complete financial collapse.

On October 16th, the following article appeared in the Waterloo Iowa Evening Courier. In it, Fisher disputes predictions of a pending drop in stock prices and insists the market will remain bullish. He claims stocks have reached a “permanently high plateau.”

Stock Market to Rise, Not Decline, Prof. Fisher Says
The Waterloo Evening Courier, 16 Oct 1929

On October 23rd, Fisher appeared in a Movietone News clip to reassure the concerned populace. On October 29th, Fisher’s predictions were proven immensely inaccurate when share prices on the New York Stock Exchange collapsed.

Soon after, The Great Depression changed lives worldwide. Few family histories are without their share of depression-era tales of unemployment, lost investments, or plummeting land values.

Below is the full text of the article.

New York, Oct 16 – Prof. Irving Fisher, noted Yale economist, today stands committed to the “bullish” side of the stock market.

“A higher market” is his forecast, made in a speech here last night. Thus, Prof. Fisher took issue with the prediction made some weeks ago by Roger W. Babson, economist, that there would be an 80-point drop in stock prices.

Prof. Fisher said he expects to see the stock market a good deal higher than it is today within a few months. Stock prices, he declared, have reached “what looks like a permanently high plateau.”

The rise of the market in the past two years was “justified” by conditions, he said.

Professor Fisher’s reputation never quite recovered, and thanks to depression-era rationing, some grandmas still keep a coffee can of used bacon grease under the kitchen sink “just in case.”

 

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