The Great Crash, 1929

Rampant speculation, record trading volumes, assets bought not because of value but because buyers believe they can sell them for more in a day or two, or an hour or two. Welcome to the late ’20s. There are obvious & absolute parallels to the bull market of the late ’90s, he writes in the ’97 introduction. Of course, every financial bubble since ’29 has been compared to the Great Crash, which is why this book has never been out of print since being a 1955 bestseller. Galbraith writes with great wit & erudition about the perilous actions of investors & curious inaction of the government. He notes that the problem wasn’t a scarcity of securities to buy & sell; “the ingenuity & zeal with which companies were devised in which securities might be sold was as remarkable as anything.” Those words become strikingly relevant in light of revenue-negative start-up companies coming into the market each week in the ’90s, along with fragmented pieces of established companies, like real estate & bottling plants. Of course, the ’20s were different from the ’90s. There was no safety net below citizens, no unemployment insurance or Social Security. Today we don’t have the creepy investment trusts–in which shares of companies that held some stocks & bonds were sold for several times the assets’ market value. But, boy, are the similarities spooky, particularly the prevailing trend at the time toward corporate mergers & industry consolidations–not to mention all the partially informed people who imagined themselves to be financial geniuses because the shares of stock they bought kept going up.–Lou Schuler (edited)