In early 1928 the Dow Jones Average went from a low of 191 early in the year, to a high of 300 in December of 1928 and peaked at 381 in September of 1929. (1929 ) It was anticipated that the increases in earnings and dividends would continue. (1929 ) The price to earnings ratings rose from 10 to 12 to 20 and higher for the market's favorite stocks. (1929 ) Observers believed that stock market prices in the first 6 months of 1929 were high, while others saw them to be cheap. (1929 ) On October 3rd, the Dow Jones Average began to drop, declining through the week of October 14th. (1929 ).
On the night of Monday, October 21st, 1929, margin calls were heavy and Dutch and German calls came in from overseas to sell overnight for the Tuesday morning opening. (1929 ) On Tuesday morning, out-of-town banks and corporations sent in $150 million of call loans, and Wall Street was in a panic before the New York Stock Exchange opened. (1929 ).
On Thursday, October 24th, 1929, people began to sell their stocks as fast as they could. Sell orders flooded the market exchanges. (1929 ) This day became known as Black Thursday. (Black Thursday ) On a normal day, only 750-800 members of the New York Stock Exchange started the exchange. (1929 ) There were 1100 members on the floor for the morning opening. (1929 ) Furthermore, the exchange directed all employees to be on the floor since there were numerous margin calls and sell orders placed overnight. Extra telephone staff was also arranged at the member's boxes around the floor. (1929 ) The Dow Jones Average closed at 299 that day. (1929 ).
On Tuesday, October 29th, 1929, the crash began. (1929 ) Within the first few hours, the price fell so far as to wipe out all gains that had been made the entire previous year. (1929 ) This day the Dow Jones Average would close at 230. (1929 ) Between October 29th, and November 13 over 30 billion dollars disappeared from the American economy.