I'd like to recommend a lovely little book I've just read, called 'The Great Crash of 1929' by the American economist Galbraith. It's a small book of just over 190 pages and less than 140,000 words, so it's a quick and easy read. As you might have guessed from the title, this book is all about a major event in American economic history: the Wall Street stock market crash of 1929. This "stock market crash" was the direct cause of the global economic depression, which was one of the most destructive financial events of the 20th century. The U.S. stock market was really hit hard by the crash and stayed low for almost 25 years until 1954, when it bounced back to its pre-crash level. It was also in 1954 that Galbraith, who had become a professor of economics at Harvard University, decided to write a little pamphlet reviewing the circumstances of the "crash" 25 years earlier. This was called "The Great Crash of 1929".

It's worth mentioning that Galbraith didn't put much effort into writing this book. He just picked a topic that interested him and, between his academic research, managed to find half a year to write a slim book. In a wonderful surprise, the book "1929 Crash" was released and quickly rushed to the major bookstores in the United States, where it made it to the best-seller list. In its first year, it sold more than 100,000 copies! What's even more incredible is that this popularity doesn't just happen once, but every few years! In 1987, the US experienced another stock market crash. Amazingly, this book was once again on the bestseller list! When the 2008 financial crisis broke out, the lovely folks at Harper Group, who published the 1929 Crash, received 12,000 copies of the new edition in just a few weeks! Can you believe it? 12,000 new orders for copies! Since its first publication in 1954, Galbraith's wonderful book has sold millions of copies and been reprinted nine times, most recently in 2021. I think it's fair to say that it's not just a phenomenal bestseller, but it's also become a bit of a barometer for the U.S. economy.

Have you ever wondered why a "leisure book" written by a big economist is so popular? Galbraith himself has an explanation, and it's really quite interesting! He said that the 1929 crash of the U.S. stock market was a financial bubble and that people were acting in a speculative way. The thing is, most of us aren't particularly vigilant when it comes to our speculative mentality. It's so sad - they often have to wait until the crisis has really come and caused losses before they will buy a copy of The Great Crash of 1929 and learn the lessons of their predecessors. This has been an afterthought, bless 'em! Galbraith also wanted to remind us that in the fast-paced world of economic growth, it's easy to lose sight of the risks involved. We're all susceptible to the allure of optimism, which can sometimes lead us down the path of least resistance when it comes to investing. It's hard to believe that the 1929 U.S. stock market crash happened nearly 10 years after the boom! We can learn from history, and it shows us that the 1987 U.S. stock market crash, as well as the 2008 global financial crisis, repeated the same mistake. So, Galbraith's hope is that everyone who reads The Great Crash of 1929 will take it as a warning and look at economic growth and personal investment calmly. So, why not get ahead of the game and buy the book now, before you need it? It's a great reminder for us today, too!

I totally get it if you're thinking, "Economists write about stock market crashes, and there'll be loads of jargon and it'll be really technical, right?" Not at all! Galbraith's book, The Great Crash of 1929, is a real page-turner! It's full of fascinating characters and intriguing stories. In his book, Galbraith paints a vivid picture of the people who were responsible for the stock market crash. He shows us bankers who were full of confidence, government officials who had no concept of risk, and ordinary people who were eager to get rich. Together, they were a group of portraits that supported the crash on the eve of the outbreak of the American stock market. When the stock market crash came, most people still had a lucky feeling that they could get out of it in one piece. They thought the end was going to be bleak, but they were hopeful. In these stories, Galbraith helps us understand the emotional and social reasons behind a financial crisis. He also looks at what causes these things to happen. His analysis is still really valuable today!

So, who was Galbraith, the author of this book? I'm delighted to tell you that he lived to the grand old age of 97, taught at Harvard University for an incredible 50 years, served as a senior adviser to four presidents, and also served as the United States Ambassador to India. He's a real legend who has spent his whole life crossing over between politics and academia. He's been around for the whole of the 20th century! In the 1950s and 1960s, Galbraith published a trilogy on American capitalism, which is still regarded as a masterpiece of the institutional economics school. It's a real treat for anyone interested in the subject! He's not one for borrowing too many theories and mathematical models in his writing. But he's a dab hand at storytelling! He's particularly good at restoring complex political and social backgrounds. And he's an economist who's very friendly to ordinary readers. I truly believe that Galbraith's wonderful book, The Great Crash of 1929, will also give you something new to think about and something new to gain.

I'd like to introduce you to the main points of the book in two parts, if that's ok with you? Let's dive in and explore the financial speculation that took place in the United States on the eve of the 1929 Crash. We'll also take a closer look at the reasons behind it. In the second part, I'll look at what happened after the stock market crash. We'll see how the American financial community tried to help, but it wasn't enough. This crash can teach us a few things about what to look out for today. So, what can we learn from this stock market crash that might help us today?

Part I

Before I start sharing the heart of this book with you, I'd like to tell you a story about a con man. This shady character, as Galbraith calls him, isn't the star of the show. But his name is still bandied about to this day! His name was Charles Ponzi, a swindling Italian immigrant who was given the name of the "Ponzi scheme" after him.

When it comes to the Ponzi scheme, we already know today that it relies on the continuous absorption of investors and the payment of interest to old clients with newly received funds to create the myth of a "high rate of return," which is not sustainable at all. Ponzi is based on this model. In 1920, he was caught out and lost 20 million U.S. dollars, which would be worth 200 million today. Sadly, his scam was soon discovered and he was jailed for five years. After his release from prison in 1925, Ponzi made his way to Florida, the sunny southeastern United States. There, he opened a real estate company. At that time, Florida was going through a rough patch. The tourism industry was struggling, and there were a lot of big construction projects that didn't quite work out. Ponzi told the public that he'd found a great piece of land. He said that if you built a resort hotel there, you could get a whopping 400% return! But he didn't have enough money to go ahead with it, bless him! So he had to "give up the pain" and divide the land into 23 parts. He's now looking for partners in the country to help him out. If you're interested in purchasing just a portion of the land, say 1/23 of the property rights, you'll receive dividends within two months. Plus, you can resell it to make a profit on the difference!

Sadly, Ponzi's new plan didn't work out as well as he'd hoped. In the autumn of 1926, a hurricane came along and destroyed half of Florida's coastline. It was such a shame because the whole state was really starting to enjoy a bit of a "tourist fever" at the time. Unfortunately, Ponzi's dividends couldn't be paid out because of this. At this point, the shareholders finally thought it would be a good idea to go to the scene to see what happened to their hotel. The truth was a bit of a shock, to be honest. Ponzi had managed to get his hands on a plot of land, but it was in a bit of a tricky spot, not right by the sea and not that popular with tourists. Sadly, the hotel that was promised never actually materialised. Ponzi had made millions from the scheme but had already spent almost all of it. Although the court did eventually sentence him to seven years in prison, the poor shareholders will never get their money back. It's so sad - throughout the Florida real estate bubble, more than $100 million just "evaporated" out of thin air!

The Florida real estate market had a bit of a hiccup in 1926, three years before the stock market crash in 1929. But Galbraith thought it already had most of the hallmarks of a bubble economy. Firstly, it's important to note that investors often had limited knowledge about the projects they were participating in. Ponzi's lovely clients were mostly financial institutions and middle-class families on the East Coast of the United States. They'd never been to Florida before and, after reading a few posters and realising that the price of local land was indeed skyrocketing, they made the decision to put their money in. Galbraith said that the more distance there was between investors and the market, the more gullible Ponzi was as an intermediary, and the greater the risk of an "explosion". Secondly, Ponzi didn't want to build his own hotels or businesses. He just wanted to be a second-hand dealer, reselling the land at a higher price. Galbraith makes a good point. All these speculators are driving up the price of Florida real estate. It's only natural that as more and more people get caught up in the excitement of buying land in Florida, prices will continue to rise. On the other hand, if there are fewer and fewer people looking to make a quick profit, the bubble will pop! It's not about the true value of the asset anymore.

I'd love to know why there were so many speculators in the US at that time! This brings us to the term "Roaring Twenties". It's actually quite simple! After the end of World War I, the U.S. industrial economy, urbanisation, and per capita income all grew really quickly at the same time. From 1920 to 1929, the total U.S. GDP grew really quickly, from less than $600 billion to $800 billion! That's an average annual rise of 5.5 percent. And guess what? Incomes for the working class rose by 11 percent a year! Many folks could already afford some pretty cool new "toys" like refrigerators, telephones, and personal automobiles. It's hard to believe, but in 1929 there were more than 20 million telephones, 40 million radios, and 26 million automobiles in the United States! On average, there was one car for every five people, which is eight times more than in the United Kingdom at the time! The lovely Manhattan core of New York, as we know it today, was built during the Roaring Twenties. The famous Empire State Building is a wonderful reminder of these happy times.

In the Roaring Twenties, who were the people that the average American looked up to and admired? Galbraith also had a lot to say about entrepreneurs. Taylor, the founder of the Scientific Management Act, and Ford, the "automobile king", were all heroes in the minds of Americans. But the one we all know and love is the New York mogul Raskob. He was the second-in-command of the wonderful chemical giant DuPont, a vice president of the fantastic General Motors, and the brilliant initiator of the Empire State Building project. What's even more amazing is that Raskob started from nothing and worked his way up to the top, which makes his image all the more inspiring. Raskob was just as keen to bask in the limelight and was eager to share his "get-rich-quick" tips with the general public. In fact, he famously wrote in 1929 that "Everyone Should Be Rich". It's worth noting that he said "should", not "could". He was also quite emphatic in his tone. Raskob did some sums and worked out that the average monthly income of the working class in the United States at that time was about 70 dollars. So, let's say you save $15 a month to buy stocks. Then, you don't spend the profits in the stock account. So, if you put aside $15 a month and let it grow at the current wage growth rate and stock returns, 20 years later you'll have $8,000 saved and $400 a month in investment income. That's enough to live a generous life! If the money came in slowly, he could join a trust fund and take out loans to buy stocks and bonds. That way, he could enjoy the benefits of a generous income without having to worry about how quickly it came in. Raskob truly believed that this idea of his was something that could work for anyone.

We all know that stocks can be risky, so it's important to invest with caution. But in the Roaring Twenties, the annualised rate of return on high-quality blue-chip stocks in the United States could reach 11%, which was almost equal to the wage increase! It's no surprise that the average person has long since put the sense of risk to the back of their minds, given the incredible returns on offer! And there's another thing. Back then, the whole of US society was full of people encouraging each other to spend and invest. The lovely Columbus Circle in Manhattan, New York, had a wonderful neon billboard nearby that read, "When you are 30 years old, you should have $10,000 in assets; when you are 40 years old, it is $25,000; and when you are 50 years old, it is $50,000." Newspaper ads also talk every day about the so-called "modern lifestyle". They say you have to have a new car, a refrigerator in the kitchen, a mink coat for your mother's birthday, and a diamond ring for your wife on your wedding anniversary. ... It's so sad that such inflated desires are not affordable for many people. Sadly, wages that are growing at an even rate just can't afford it. So, merchants were quick to jump on the installment bandwagon! Even stockbrokers were out there, setting up stalls along the streets to chat with customers. It's amazing to think that back in the 1920s, more than 60% of all cars, furniture and radios in the USA were sold by instalment! And guess what? Stockbrokers' counters even popped up on college campuses and in pharmacies! From 1923 to 1927, the par value of new U.S. stock issues saw a whopping 200 percent increase! It was a time when everyone was chasing their fortune. There was a historian of the time, Lewis Allen, who sadly noted, "From New York and San Francisco to the countryside, even cobblers and bartenders were chatting about stock market quotations." It's not uncommon for a hard-working blue-collar worker to have a few hundred shares of oil company stock. "The stock market has become a religion to them, and those who didn't get rich quick are even ashamed of it."

If it were just ordinary folks who were into financial speculation, the dangers might not have come so quickly. But author Galbraith makes a good point. He says that corporations themselves are getting into the financial markets and turning into the mainstay of speculative activity. As we've already chatted about, the United States enjoyed a fantastic period of economic growth in the Roaring Twenties! But back then, the market was not like it is today, with a large number of small businesses, start-ups and industry giants all living side by side. Back in the 1920s, the U.S. economy was led by just a few big companies. They quickly spread across the country, with the help of banks, and captured most of the consumer market. In the United States in 1929, 50 percent of industrial and commercial wealth was concentrated in the hands of 200 large corporations, most of which were still publicly traded. The everyday workings of these companies had shifted out of the real economy and started to become more focused on finance. Like Raskob, he's not really into the chemical industry or automobiles. But he's great at managing money, so he can actually influence decisions at DuPont and General Motors.

In the context of financialisation, business owners gradually developed a bold idea. With the bull market looking like it could go on forever, it's a great idea to lend money to stockholders through stockbrokers. It's a quick way to make money from their short selling and buying, rather than investing in the long cycle and slow recovery of production. In other words, big businesses are using their own money to speculate on their own stock price, which is a bit of a tricky situation. Oh my, that would never be allowed today! But in the relaxed 1920s, it actually became a trend! The lovely Galbraith says that by this time, the stock market bubble and what was once Florida real estate were pretty close. It's so sad - a company's share price was completely decoupled from its main business and became a pure numbers game. And the steady stream of ordinary folks pouring into the stock market provided the second condition for creating a bubble: speculators. It's like a rapidly expanding financial "balloon" that's still a bit fragile, but it's taking shape pretty quickly!

I'm sure you're wondering what the U.S. government is doing about this. It's only natural that businesses and stockholders are driven by profit. But it's also the government's job to make sure everything is regulated properly. It's so sad that back in the 1920s, the U.S. government thought it was best to just let things be and didn't want to get involved. The man at the heart of politics at the time was Treasury Secretary Andrew Mellon. The lovely Carnegie Mellon University was named after him and the wonderful "steel king", Carnegie. Mellon himself comes from a wealthy family, and under the rule of three generals as finance minister for 11 years, he was quite the powerful figure in the field. He had a simple, three-point plan: tax cuts, spending cuts and low interest rates. Mellon believed that the U.S. economy was entirely dependent on business. He thought that the government should let businesses do their thing and create facilities for entrepreneurs to help them finance expansion. But again, the people that Mellon was supporting weren't the everyday folks in the real economy. They were the big businesses and the banks behind them. Unfortunately, this made things worse.

Mellon was a big influence in the late 1920s, when the Federal Reserve cut the rediscount rate for commercial banks several times to help the financial sector move forward. So, commercial banks, having just gotten money from the central bank at a low 3.5% rate, immediately lent to stockbrokers at 12%. They were feeling pretty confident, you know? Historian Lloyd Eitenberg has a fascinating take on this. He says that in those years, banks had become less like banks and more like promoters of securities firms. They were so bold as to push anything on their clients except not selling automobile wheels. It's so interesting to see how things changed over time! According to the wonderful Galbraith, from 1921 to 1929, the size of the real U.S. economy expanded by only 50 percent, but the amount of money in circulation increased by 224 percent. It's worth noting that loans related to the stock market have accounted for 10 percent of broad money issuance, which is a pretty dangerous number. Because every loan, whether it's to an ordinary consumer or to a securities firm, bank or corporation, affects the whole system, it can be said that we're all in this together. But nobody saw it coming.

Part Two

Well, as the book records show, the 1929 stock market crash happened right before the outbreak of financial speculation in the United States. It's so interesting to see how things unfolded. Even before 1929, some people were aware that the US economy was not as stable as it seemed. There was a growing concern about the rising tide of credit caused by the bad debt rate. That summer, the lovely folks over at the U.S. Department of Commerce released a few statistics that showed some interesting changes. The national consumption growth rate had slowed down a bit, from 7.4% in 1928 to 1.5% that year. Investment in housing construction was also seeing a decline, and there was a lot of unsold inventory, amounting to a whopping $1.5 billion! I'm sure you'll agree that this is typical "negative" news. The good folks at the Fed responded right away by raising the rediscount rate in hopes of limiting new credit. But this had an unexpected result. All the stockholders wanted to make the most of the current situation before the end of the "bull market" and were confident that they could do so. As a result, people were getting really excited about making money from the stock market. By the end of August 1929, the value of all the stocks on the New York Stock Exchange had reached an incredible $87 billion! And that's not all – there were also $8.5 billion in loans through brokers. This figure was already comparable to the actual amount of money in circulation, which was a pretty risky situation.

On 3 September 1929, the Dow Jones reached its highest point ever! It stayed there for a whole month and a half. During that month and a half, the number of new folks entering the market slowed down, and there were lots of rumours about some not-so-great news. It was such a shame – the magic of the "bull market" seemed to disappear overnight! As we moved into the second half of October, we saw a steady decline in the share price of large companies. It's so important to remember that the first half of the gains can be lost in just two or three days. By 24 October, the New York Stock Exchange opened and, sadly, the market fell 11%. Then, sadly, the automated quote machine gradually failed to keep up with the falling stock prices. In just half an hour, the once blue-chip stock had gone completely unclaimed. Eleven poor souls who were forced to close their positions jumped to their deaths on the spot. Understandably, the New York Stock Exchange urgently closed its top-floor viewing corridor to prevent people from running up the stairs. This day is known to historians as "Black Thursday". It's also the beginning of the "stock market crash" in 1929.

It's important to remember that the stock market crash actually began. Some of the biggest financial names in the US have been trying to find ways to "protect the market". It was 12:00 noon on October 24th, and the 23rd of Wall Street, J. P. Morgan's headquarters, was buzzing with excitement as an emergency meeting was held. The meeting was attended by six big names, including Mitchell, who was the Chairman of National City Bank, Whitney, who was a vice president of the New York Stock Exchange, and Lamont, who was the executive director of Morgan Bank. Six bigwigs got together and decided to chip in 240 million U.S. dollars to buy the main blue-chip stocks at a price higher than the real-time market price. They did this to help keep everyone's spirits up and show their confidence in the "White Knight." The good news is that the content of this meeting was quickly leaked to the media, which helped to maintain market confidence. Thankfully, after this operation, by the close of the market that afternoon, the decline of the Dow Jones temporarily stopped. But it was a different story in the broader market, which still looked a bit half-dead and saw more stockholders leaving.

It's worth noting that the United States hadn't experienced a major stock market crash for 22 years by 1929. Many folks who've experienced the stock market crash still have memories of 1907. Thankfully, the banking giants came to the rescue! So, people like Mitchell and Whitney, as well as the lovely Raskob, are feeling really positive and confident that: Oh, don't worry about "Black Thursday"! It was just an accident. Once the "long" forces have entered the market, the trend can be reversed. As luck would have it, on October 25th and 26th, stock prices actually returned to a small range of volatility and didn't plummet again. The stockbroker community were quick to jump on the bandwagon, suggesting in every possible way that now was the best time to take a position on the low side. Even President Hoover was there to lend a helping hand! On October 25th, he gave a speech to the nation, openly declaring: "I'm happy to say that our country's main commercial activity, the production and distribution of goods, is now on a sound and prosperous basis." There was no sign of concern whatsoever.

But the strange thing about the "stock market crash" of 1929 was that, as crazy as the sudden rise had been, it was now inevitable that it would fall. After a quick little break on the 27th, the crash started up again on the 28th of October. The poor Dow Jones lost a whopping 12.82 percent of its value! And the prices of blue-chip stocks such as General Electric, Westinghouse, and U.S. Steel practically lined up to fall. Before the market closed in the afternoon, the bankers met up again at JPMorgan. This time, they were starting to worry that they might not be able to keep stock prices in a "reasonable" range. The meeting ended with the decision to "go cold turkey," which basically meant doing nothing. The effects of this decision were felt the very next day, when 29 October became the saddest day since the founding of the New York Stock Exchange, known as "Black Tuesday". Oh my! The Dow Jones fell 11.73% at the opening bell. In the first half hour alone, 3 million blue-chip shares were sold. It was a madhouse out there! Everyone was selling their stocks at any price, and the sellers were hundreds of times the buyers. On that fateful day, there was even a bit of light-hearted humour to be found. A letter carrier delivering mail to the New York Stock Exchange had the amusing idea of buying a random stock at $1 per share before the market closed in the afternoon, and the sale was actually made! At this point, it's safe to say that the idea of "commercial rationality" is out the window. It's like everyone's mind was suddenly flooded with one overwhelming thought: run!

Thankfully, the volume of shares traded on Black Tuesday finally stopped at 16.41 million. The New York Stock Exchange's automatic quotation machine was so quick to print out the final price of all the shares that it took two and a half hours after the market closed for it to catch up! The average price of the 50 major industrial stocks followed by The New York Times fell by a whopping 43 percent! That's the equivalent of the gains of the past 12 months in a single day. Blue chips, which the financial moguls had hoped to save five days earlier, suffered similarly heavy losses. It was a sad day for General Motors Corp. Their outstanding shares saw their market value shrink by a whopping $2 billion in just two days. The total loss for the entire market was a whopping $30 billion, which is one-third of what it was before the crash. And the trusts and small exchanges that are tied to the stock market were even worse. Goldman Sachs, as we know it today, was actually in the trust business. Their main trust product, Blue Mountain, saw a whopping 87.5% drop in yield in just one week. The company's market capitalisation took a tumble of 92%, which sadly led to near-instant bankruptcy.

In November 1929, even the bankers began to flee in panic. Even though the New York Stock Exchange kindly invited the Rockefeller family to take the stage, claiming that a large amount of "bailout" funds will soon be in place, they unfortunately couldn't contain the "stock market crash" from spreading. It's really quite worrying that the financial problems have started to affect the real economy too. Big companies are having to cut back on investment and spending, and they're laying off staff. Many of the American folks who just lost their entire fortune in the "stock market crash" are now facing a really tough situation. Thankfully, it wasn't long before things started to look up. It was four and a half years later, in July 1933, that the "crash" really ended. It's so sad to think that at that time, the market value of all the stocks on the New York Stock Exchange was only one-sixth of what it had been before the "crash." Can you believe that the entire $74 billion in capital "evaporated" on the spot? That's a sum equivalent to three times the U.S. military expenditure in World War I! The lovely Galbraith has some pretty eye-opening statistics about the 1929 stock market crash. It looks like the financial tsunami triggered by the crash led to more than 4,000 banks and financial institutions going bankrupt. That's a lot of businesses! And it also led to 2.25 billion U.S. dollars in deposits disappearing into thin air.

I'm sure you're all wondering why the 'bailout' didn't work in 1929. Galbraith did some analysis and shared his findings. He discovered that the folks holding stocks in the US at the time could be taken advantage of by the "margin trading" method. This model is what we often call "leverage" today. The great thing about stock is that you only need to pay 10% of the purchase amount. The remaining 90% is provided by the broker as a loan, which often has a very high interest rate. And if the price of the stock keeps on rising, of course, everyone involved will be able to enjoy the profits. But, sadly, if the market crashes, not only do shareholders lose their own money, but they also bring the brokers and banks down with them. Banks have already been emptied out in advance, so unfortunately the "rescue" can't make full use of them. But let's not forget that at that time, the United States stockbrokers and banks were also involved. They were part of the speculative culture that promoted it all. Later on, when the U.S. Congress got around to sorting things out, they discovered that Whitney, the vice president of the New York Stock Exchange who was in charge of risk regulation, had actually been embezzling for a long time and didn't care much about his duties. Whitney was given a three-and-a-half-year prison sentence and banned from securities trading for life. A number of other bankers were also given some form of punishment, to varying degrees.

But margin trading was just a technical detail. Galbraith thinks that the real issue is that the United States wasn't quite ready for the "stock market crash" that happened right before the economic boom. There were some imbalances in the supply and demand, which contributed to the problem. Let's take the United States as an example. Between 1920 and 1928, industrial production capacity increased by a whopping 30%! This lovely growth was partly down to lower production costs and partly the result of a wonderful sense of optimism. It's so interesting to see how things changed during this same period! The population of the United States grew by only 12 percent, which is quite a bit less than the 30 percent growth in industrial production capacity. In other words, even with more instalment payments and more advertising, there just weren't enough consumers to buy all the goods on the market! So, would it work to export goods abroad, as we do today? I'm afraid that in the 1920s, this wasn't really a good idea. That's because U.S. Treasury Secretary Mellon was pursuing a policy of high tariffs and low exports, which unfortunately didn't work out so well. Sadly, the European market, which has the ability to consume, closed its doors directly to U.S. goods. And the government hadn't yet realised that relying on investment-led growth was a good idea. So, companies could only focus on consumers, counting on them to "buy, buy, buy" – and who can blame them!

I'd love to know what the average American was spending their money on at the time! I'll share a few figures with you. In 1929, 71% of U.S. households earned less than $2,500 a year. Just 2.3% of folks made over $10,000 a year. For most of us who work for a living, paying for cars and furniture in instalments has already drained our family budgets. It's just not possible to increase our spending on non-essentials. And it's not just that, but the gap in incomes between urban and rural areas in the USA is also pretty shocking. Of the 123 million Americans at the time, only 15% were lucky enough to live in urban metropolitan areas like New York and Chicago. It was a really tough time for farmers and ranchers in the countryside. They were affected by high tariff policies and couldn't find overseas customers at all. They can only sell wheat, cotton and pork at a discount to big businesses, and it's a struggle just to make ends meet. It's fair to say that the imbalance between supply and demand, which is an inherent problem of the capitalist system, was already growing in the U.S. at that time. This was the precursor to the coming crisis. But, bless their hearts, most folks didn't see the cliff coming. They were still running as fast as they could towards the illusion of "stability and prosperity" until tragedy struck.

And that, folks, is the main content of the book "The Great Crash of 1929" by Galbraith. Thanks for joining me!

It all started in the United States in 1929 with the "stock market crash." This eventually led to a global economic depression that lasted for over 10 years. It's all connected to the Roosevelt New Deal, the start of World War II and other historical events. It's no surprise that this "stock market crash" has become a topic of interest for economists and historians. After all, it had such a significant impact and cost us so much. Galbraith's book, The Great Crash of 1929, is one of the most widely read books out there. It explains not only why the stock market crashed, but also shows how blind optimism and a love of speculation among Americans at the time led to some pretty crazy behaviour. It's been shown time and again that a "stock market crash" won't get rid of speculation altogether. And every time the crisis comes around, people will turn to Galbraith's advice for guidance. This is a kind of "rhyme of history", if you will.

For us regular folks, Galbraith's little book did a great job of showing us once again just how complex economic activity can be. It also gave us a heads-up about the importance of being aware of potential risks. We all engage in a little over-consumption and financial investment in our daily lives, and there's nothing wrong with that! However, if we let our guard down and get carried away with consumerism and short-term gains, we might end up taking some big risks. If you're feeling unsure about spending and investing, this book is a great place to start. 'The Great Crash of 1929' is full of helpful advice from Galbraith himself.