Big Apple History . Business and Politics . The Boom


	Stockbrokers examine recent sales on a ticker tape.

For stock market investors, the 1920s appeared to be a dream-come-true. From 1925 to 1929, the average price of common stocks on the New York Stock Exchange more than doubled. The world economy was booming as the stock market continued to rise to unparalleled heights..

Everyone thought -- or wanted to think -- that the growth would never end. The "bull market" motivated thousands of Americans to buy stocks "on margin." This meant that investors bought stock by borrowing huge amounts of money from the broker. Although this was a major financial risk, most people did not see it that way. They figured that once their stocks increased enough, they could sell them at a huge profit and easily pay back the broker. In pursuit of fortune, many invested their life savings. By 1929, over a BILLION shares were traded! To meet the demand, the stock exchange added 275 new seats and built a second trading floor. The stock market continued to spiral upward until October 24, 1929.

Illustration: Courtesy of the New York Stock Exchange Archives.