October 1929, Wall Street. The ticker runs hours behind the trading. A crowd gathers outside the Stock Exchange the way crowds gather under a scaffold. By 1932 the market will have lost almost nine-tenths of its value.
Why then
After 1918 America is the world's creditor; its loans keep Germany paying reparations and Britain and France paying war debts. Easy credit has fed a speculative boom while farm prices sag. When the market breaks, American lenders call their money home.
What they wanted
Bankers want a correction that restores 'sound' money. President Hoover tries to talk confidence back into existence. Investors who bought on borrowed money are trying not to be last through the door.
What changed
Banks fail in waves; world trade shrinks by about two-thirds by 1933; the United States raises tariffs and others retaliate. Coffee, wheat and tin collapse, and in 1930 army coups topple the governments of Argentina and Brazil, where Getúlio Vargas will rule for fifteen years. A quarter of American workers and six million Germans are out of work. The road to Hitler's chancellery, and to Japan's war in China, runs through these numbers.
Still argued
Cause or only trigger? Most economists now blame what followed, a central bank that let banks fail, the gold standard and tariffs like Smoot-Hawley, more than the crash itself.