Brokerage Houses Are Optimistic on the Recovery of Stocks

Brokers in Meeting Predict Recovery

“A reassuring message to the stock market community went out last night over the country-wide network of private wires operated by brokerage houses. This was the result of a tacit agreement reached yesterday afternoon at a special meeting of the partners of about thirty-five of the largest wire houses of the New York Stock Exchange, at which the stock market situation was canvassed thoroughly…

…Much of the selling of the last few days, the brokers felt, was induced by hysteria. The views of all of the brokers present were heard, and none knew of anything disturbing to the general market situation…”

– The New York Times, October 25, 1929

Yes, it really did say “country-wide”. Talk about an echo in here. One refers, of course, to the market boost generated by Bank of America’s investment of $2 billion in a clearly desperate Countrywide Mortgage. I say clearly desperate because the pricing was well below market and it was preferred, not common.

One is amazed and impressed that all the folks who failed to see the problems coming are now able to declare, with conviction, that they are all behind us.