62 The Great Stock Market Crash

The stock market can be a wonderful place to make money. If you buy stock in a company at $12 a share and later sell it for $24, your investment has doubled. It is tempting to believe that stock prices will always increase, but they can also decrease. Prices of shares of all companies can drop simultaneously—and drop a lot. Then there is a market crash—like the one in 1929.

During the last week of October in 1929, people began to lose confidence in the market and to sell stock shares in great numbers. On October 29, the worst day, over 16 million shares of stock were traded—by far the highest number ever sold in one day. By November 13, the market temporarily bottomed out. In about three weeks it had lost 40 percent of its value, a drop of about $30 billion. It would be years before that value was regained.

What caused the crash? The 1920s had been years of tremendous growth and prosperity. Road construction skyrocketed as people traded in horses and buggies for cars. Radios and other consumer items rose in demand as more homes were wired for electricity. Feeling prosperous, many people looked to the stock market as a way to make money. Many stocks were bought on margin: put down as little as 10 percent and buy the rest on credit. Since everyone else was doing the same thing, the value of the market continued to rise. It seemed as if you couldn’t lose.

When stock prices began to plummet, the brokers stopped giving credit and demanded to be paid the money they were owed. In a panic, people began selling everything they had. The long spiral down into the Great Depression had begun.

股市可以是个赚钱的好地方。如果你以每股12美元的价格买入一家公司的股票，之后以24美元卖出，你的投资就翻倍了。人们很容易相信股价会一直上涨，但股价也会下跌。所有公司的股价可能会同时下跌——而且跌幅很大。这时就会出现市场崩盘，比如1929年的那次。

1929年10月的最后一周，人们开始对市场失去信心，大量抛售股票。10月29日是最糟糕的一天，超过1600万股股票被交易——这是有史以来单日成交量最高的一次。到11月13日，市场暂时触底。在大约三周内，它的市值蒸发了40%，跌幅约300亿美元。要恢复到这个市值需要数年时间。

崩盘的原因是什么？20世纪20年代是经济大幅增长和繁荣的时期。随着人们用汽车取代马和马车，道路建设激增。随着越来越多的家庭接通电力，收音机和其他消费品的需求上升。因为觉得生活富足，许多人把股市当作赚钱的途径。许多股票是通过保证金交易购买的：只需支付10%的首付，其余部分赊购。由于其他人都在这么做，市场价值持续上涨，似乎没人会亏钱。

当股价开始暴跌时，经纪人停止提供信贷，并要求偿还所欠的款项。人们陷入恐慌，开始抛售所有资产。这场通向大萧条的长期螺旋式下跌就此开始。