Sometime, sooner or later, confidence in the short-run reality of increasing common stock values would weaken. When this happened, some people would sell, and this would destroy the reality of increasing values. Holding for an increase would now become meaningless; the new reality would be falling prices. There would be a rush, pellmell, to unload ( Read more... )

At any givenn time there exists an inventory of undiscovered emblezzment in - or more precisely not in - the country's business and banks. This inventory - it should perhaps be called the bezzle - amounts at any moment to many millions dollars. It also varies in size with business cycle. In good times people  are relaxed, trusting, and money is ( Read more... )

In 1929 there were good, or at least strategic, reasons for this view, and it is easy to understand why it has become high doctrine. In Wall Street, as elsewhere in 1929, few people wanted a bad depression. In Wall Street, as elsewhere, there is deep faith in the power of incantation. When market fell many Wall Street citizens immediately sensed ( Read more... )

... as often in our culture, it is far, far better to be wrong in a respectable way than to be right for the wrong reasons.

John Kenneth Galbraith. The Great Crash 1929.

... at some point in the growth of a boom all aspect of property ownership become irrelevant except the prospect for an early rise in price. Income from the property, or enjoyment of its use, or even its long-run worth are now academic. As in the case of the more repulsive Florida lots, these usufricts may be non-exustent or even negative. What is ( Read more... )

It requires neither courage nor prescience to predict disaster. Courage is required of the man who, when things are good, says so. Historians rejoice in crucifying the false prophet of millennium. They never dwell on the mistake of the man who wrongly predited Armageddon.

John Kenneth Galbraith. The Great Crash 1929.

As a protection agaist finacial illusion or insanity, memory is far better than law. When the memory of the 1929 disaster failed, law and regulation no longer sufficed.

Joh Kenneth Galbraith. The Great Crash 1929.