Hi,
I'm also reading "Six Days in October", and looking for parallels and differences between what went on back in 1929 and what happened to the stock market just a few short years ago.
One clear similarity is how bank leadership was trying to escape blame, even attempting to profit from the situation as described in page 103: "During the greatest stock-market decline of all time, Mr. Wiggin (chairman of Chase National Bank) would make a person profit of $4 million." This was done by betting that his own company's stock would go down.
The difference I see is that the government actually took some action back then by creating "the first real national rules for the stock market" (Blumenthal, 141). It would be interesting to delve into how the Glass-Steagall Act of 1933 helped to control this type of problem until it's Republican repeal in 1999 (signed by Bill Clinton). I know that banks' holdings of sub-prime mortgages steadily increased after this change. These days, government seems nearly powerless to regulate wall street. It's interesting how history repeats itself.
-David Jurecka
David,
ReplyDeleteI share your question and desire to draw comparisons to the crash of 1929 to the crash of 2008. I think the ability to link the two will allow for a more relevant lesson plan regrading students. If we can link these two events, we can provide modern proof of what can happen when financial systems are given free reign, a sense that history is repeating itself. I am waiting for someone to pen a book (similar to Blumenthal's) that digests the financial crisis of 2008 for younger audiences.
Lydia Foster
David and Lydia,
ReplyDeleteI have yet to read Six Days in October, but have a feeling I will soon enough. I often try to stay away from the talk of the stock market because I don't understand it. I often found it uninteresting and somewhat of gambling. I am TYPE A personality, so I need constant control (especially of my money). However, I too would like to see the similarities and differences that came from both collapses/recessions/depressions. This is especially important since right now we are living with the economy, and instead of ignoring the situation, it could be a great learning opportunity for not just us, but our students and children we come in contact with daily.
Shannon Hanrahan