I first started blogging on ideas relating to economics, finance, investments and housing following an invitation from Business Spectator Please note that I may have an economic interest in any of the items discussed here. The market was in an upward trend in the 1920’s and investments in shares were on the increase. This phase can be recognized by the saturation of the stock market and the increasing competition. As with many market reversals, the causes are numerous, intertwined, and controversial.

In 1963, Benoît Mandelbrot proposed that instead of following a strict random walk, stock price variations executed a Lévy flight.25 A Lévy flight is a random walk which is occasionally disrupted by large movements. The market continued to decline in value, leaving investors who had purchased stock on credit financially destroyed. This did little more than temporarily stem the tide, however, because from Black Thursday to October 29, 1929 …

Only one nice trading session is needed for S&P 500 and DJI to hit this level and if it is broken it could mean that we may see further move up. However, I consider that the odds of the bounce down again are still good. The investor class, banks and government then conspired to rally the markets by pumping lots and lots of money into it, and eventually by mid 1930, it hit a ‘dead cat bounce’ peak of 294, quickly pushing up another 90{606b15cb8282e5ec3580d0e72c193589ece6551be175750a8e347f0d91362e12} to get it to early 1929 levels.

This was the worst stock market crash that affected global economics because this crash lasted longer than the short plummeting that had occurred in 1987. What made Black Thursday such a bad day in the history of the New York Stock Exchange was the loss of people’s faith in Wall Street For more, see Timeline of the Great …