Who got punished for the 1929 crash?

Discussion in 'Educational Resources' started by Pekelo, Jan 25, 2011.

  1. Pekelo

    Pekelo

    Interesting article about the aftermath of the Crash of 1929:

    http://www.slate.com/id/2282404/

    Best part:

    "Insull's acquittal led to the Public Utility Holding Company Act of 1935, which limited the size of utilities and barred them from speculating in the market. Congress repealed the law in 2005. "

    "Mitchell's performance at the Pecora Hearings led to the Glass-Steagall Act of 1933, which prohibited banking companies from speculating in the market. The law was repealed in 1999."
     
  2. 1) Who was punished? Few people were. There was no "SEC" yet. :(
    2) Regulation occurs after the "fire has burned out". De-regulation occurs before the "fuse is lit". :eek: :mad:
     
  3. LeeD

    LeeD

    Deregulation seems to light up the fuse.
     
  4. zdreg

    zdreg

    in this case it was the confluence of government and private industry that led to booms then to busts. the government instructed american banks to lend money to unqualified borrowers as part of social policy. then everybody tried to keep the party going ignoring the laws of economics. the result is history
     
  5. I'd say those who were punished were also those who gained the most. A few got out before the crash (and a tiny number perhaps made money shorting it) but many wealthy people and speculators saw entire fortunes go up in smoke. And of course, thousands of banks and financial companies went under, with the owners/partners/managers left jobless and wiped out.

    The miracle of the market. This is all unthinkable today, of course.