The Washington Post

Here’s how The Post covered the start of the Great Depression


Tuesday is the anniversary of one of the most important days in financial history. Oct. 29, 1929 was Black Tuesday, a day of torrid selling on Wall Street. It was the start of the darkest period in modern economic history, the Great Depression, a global catastrophe that left millions of people around the world starving and impoverished and laid the groundwork for the rise of the Nazis and World War II.

So how did The Post cover Black Tuesday? Not super well!

This was a day that the Dow Jones industrial average fell a whopping 12 percent, the second straight day of double-digit declines. Yet for some reason, The Post emphasized the group of bankers who had agreed to step in to prop up the market. The lead story, using the circuitous sentence structure typical of newspaperese of the day, focuses on the technical aspects of what happened on Wall Street:

Huge barriers of buying orders, hastily erected by powerful financial interests, finally checked the most frantic stampede of selling yet experienced by the securities markets and which threatened at times today to bring about an utter collapse in prices.

All trading records were broken with a turnover of 16,410,000 shares on the New York Stock Exchange and 7,095,300 shares on the New York Curb Market. This contrast with the previous records of 12,894,600 and 6,148,300 shares, respectively, established last Thursday, and a stock exchange turnover of 9,212,800 yesterday.

So maybe not a bravura performance in the lead story of capturing the import of the moment; inexplicably, while it gives the volume of shares exchanged in great detail, it does not mention at all how much the stock market actually declined. Another front-pager captures some of the drama at hand as well, with the, er, overly optimistic headline, "Money Kings to Keep Strength in Market." As the story goes:

Thomas W. Lamont, of J.P. Morgan & Co. said tonight that New York's leading bankers had been supporting the stock market in a cooperative way and would continue to support it.

"I want to take occasion tonight," he said, "to explain again as heretofore that the banking group was organized to offer certain support in the market and to act as far as possible as somewhat of a stabilizing factor." ...

The banking group met twice today, once before noon and again after the close of trading on the exchange.

Okay. Glad we got that cleared up. But what was the reaction in Washington? I mean, the Dow had fallen about 25 percent in two days! Surely the powerful men at the Treasury, the White House, and the Federal Reserve were springing into action!

Well, no. Here's the front-page story on the action in Washington that dark day:

Assistant Secretary of Commerce Julius Klein, in the first speech on the stock market situation and business made by a high administration official since the recent startling price declines, informed a national radio audience last night that "regardless of regrettable speculative uncertainties, the industrial and commercial structure of the Nation is sound."

The Commerce Department official said the volume of purchasing power measured the heights of living standards, and then declared that "basically our normal purchasing power has not been appreciably impaired."

Speaking over the Columbia network, he recalled and echoed the conviction recently expressed by President Hoover that the fundamental business of the Nation is on a firm basis.

This fact even made it into the lead headline: "Klein, On Radio, Reassures."

Pro-tip: If you're ever the president, and the financial markets are collapsing, it would behoove you to send out somebody with a little more clout than an assistant secretary of commerce to reassure the nation.



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Ezra Klein · October 29, 2013

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