What not to say when the stock market gets 'yippy'

The tone-deaf reassurances of economists and politicians

Photo by fabio Spano on Unsplash

On October 15, 1929, economist Irving Fisher spoke to a regular meeting of the Purchasing Agents Association at 2 Park Avenue in Manhattan about gyrations in the stock market.

The Dow had climbed by more than 600 percent over the preceding eight years and some forecasters were warning of a coming crash. Traders were getting “yippy, a little bit afraid,” the phrase President Donald Trump used last week to describe anxiety over his tariffs.

Fisher dismissed any fear about the future: Stock prices have reached “what looks like a permanently high plateau” and would likely go “a good deal higher … within a few months.”

It was a forecast he would never live down. Stocks dropped by about 25% two weeks later, and over the course of the Depression, market values plunged by a total of 79%. The Dow didn’t return to its pre-crash level until 1954.

On what became known as “Black Thursday,” October 29, 1929, President Herbert Hoover responded to the market crash by sayi…