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The Crash 6940 Views


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Description:

"The Crash" wasn't as sudden or violent as, say, a car crash, but its effects were certainly painful for an entire generation of Americans—not to mention people around the world.

Language:
English Language

Transcript

00:07

The Crash

00:13

Where am I?

00:14

Oh. Here I am. That was one nasty crash. [kid crashes bike on road]

00:18

I'll probably have bruises to show for it for several weeks.

00:21

But they're nothing compared to the bruises incurred from last year's crash...

00:26

Let me go back to the beginning.

00:28

Okay, a little after that. It was 1928... and the day of my twelfth birthday.

00:34

My parents wanted to give me a little capital to start my own business.

00:38

So they started me out with ten dollars... [parents give kid $10]

00:40

and I was able to set up shop at the end of the driveway.

00:44

For a while there, my name was synonymous with lemonade. [kid runs lemonade stand]

00:48

In a year's time, I had saved one hundred dollars. A small fortune. [kid puts money in piggy bank]

00:52

Of course, my parents wanted me to invest my earnings.

00:55

If there was anything that the boom of the 1920's had taught us,

00:58

it was that stocks were a "sure thing."

01:01

Dad hooked me up with his broker, who allowed me to borrow ten times as much money, as equity...

01:07

...and to buy stocks with it at some pretty fantabulous rates. [kid walk to stock market]

01:12

So I borrowed one thousand dollars and bought eleven hundred dollars'

01:16

worth of stock in an oil company.

01:18

At one dollar a share, I was able to buy eleven hundred shares. [kid with oil rig in background]

01:23

Because of all the consumer optimism at the time, everyone was pouring money into the

01:27

stock market, and my oil company was raking it in.

01:31

Before long, my stock had risen to three dollars a share, and I was

01:34

laughing all the way to the bank.

01:36

Taking into consideration my original investment,

01:38

I was suddenly worth two grand, give or take.

01:40

And I could have had all that deniro... if I had sold right then.

01:44

Oh, if only someone had visited me from the distant future...

01:47

to steer me in the right direction!

01:50

Okay, so my parents suggested I sell, but they're my parents.

01:54

They also think I should eat all my Brussels sprouts too.

01:57

I have to take everything they say with a grain of salt.

02:00

Instead, I listened to this Wall Street analyst who said my stock

02:03

was going to ten dollars a share and I'd be crazy to sell.

02:06

I didn't want to be called crazy...

02:08

So I didn't sell.

02:10

Sure enough, the stock tanked... as did the rest of the market. [militay tank explodes]

02:15

By the time my oil company had dropped back down

02:17

to its original price of one dollar a share, I was broke.

02:20

The taxes and interest had cleaned me out...

02:23

I didn't even have my original hundred dollars anymore. [kid at broken lemonade stand]

02:26

And it happened so fast.

02:28

At the end of the day, my stock had dropped even further, and was now at seventy cents a share.

02:33

I was bankrupt, and the brokerage was left having to pay what I couldn't.

02:37

They were suddenly several hundred bucks in the hole.

02:42

Sadly, my story isn't a unique one.

02:45

Last year's crash wiped out nearly everyone who had put a good chunk of their savings [old newspapers about the crash]

02:49

into the stock market. But at least I'm a kid, and I've got my

02:52

whole life to learn from past mistakes and hopefully carve out a good life for myself.

02:57

The same can't be said for a lot of grown-ups.

03:00

When the bottom dropped out of the economy, it hurt everyone pretty badly.

03:04

Demand for goods plummeted because those who had lost a bundle in the stock market suddenly

03:08

had holes in their pockets.

03:12

And good luck financing new investments through the sale of stock.

03:15

Nobody was buying stocks any longer.

03:17

They weren't falling for that again.

03:20

But in the meantime, millions had lost their jobs.

03:22

... their homes...

03:23

...and had to start standing in breadlines and visiting soup kitchens

03:27

just to keep some meat on their quickly deteriorating bones. [old photos of people in line for food]

03:31

Some even gave up all hope and jumped out of a twenty-story window.

03:35

Believe it or not, those guys were in even worse shape than my bike.

03:38

Speaking of which, I should probably get this guy down to the scrap metal yard so I can sell it for parts.

03:43

Maybe I can scrounge together enough coins to buy a few slices of bread for dinner.

03:48

But, you know... enjoy your Chinese take-out, or whatever you're having tonight.

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