Benjamin Roth began writing a diary in 1931 that detailed his experience during The Great Depression. He would continue documenting his life- 14 handwritten notebooks- until he died in 1978.
Roth does an amazing job capturing the psychology of the time, which completely gets lost in a chart. Looking at the Dow to experience The Great Depression is like looking at the sky to experience an astronaut floating in space.
Two particularly powerful entries came a decade apart:
July 30, 1931
Magazines and newspapers are full of articles telling people to buy stocks, real estate etc. at present bargain prices. They say that times are sure to get better and that many big fortunes have been built this way. The trouble is that nobody has any more. On account of numerous bank failures, the few people who have money are afraid to spend it and are buying government securities. From the extreme of speculation in 1929 people have now turned to the extreme of caution. In my own case I find it a problem to take in enough to pay and there is nothing left for investment.
February 1, 1941
A stock exchange seat sells today for $27,000 – lowest since Spanish American War. It reflects pessimism of the stockbroker as to the future of the brokerage business. It is a crazy picture. Industry in a war boom- stock market stagnant- gov’t bonds bringing less than 1% and selling at a high premium- stocks low and selling at five times earnings. Looks to me like a good time to buy. Someday and somehow the dam will burst. [Undated not here: “Right you were- but you had no money to buy”]
This was just an incredible read, I cannot recommend it strongly enough.