Crash of 1929/Tutorials: Difference between revisions
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===McGrattan=== | ===McGrattan=== | ||
<ref> Ellen McGrattan: ''The Stock Market Crash of 1929: Irving Fisher Was Right!'', Federal Reserve Bank of Minneapolis, Research Department Staff Report 294, December 2001[[http://www.bportugal.pt/events/conferences/CME/mppaper.pdf]]</ref> | found that, on conservative estimates, the market value of U.S. corporations was no | ||
greater than 19 times corporate earnings (or 1.67 times GNP), and the fundamental value of U.S. corporations was no smaller than 20 times corporate earnings (or 1.78 times GNP) <ref> Ellen McGrattan: ''The Stock Market Crash of 1929: Irving Fisher Was Right!'', Federal Reserve Bank of Minneapolis, Research Department Staff Report 294, December 2001[[http://www.bportugal.pt/events/conferences/CME/mppaper.pdf]]</ref>. | |||
===Friedman=== | ===Friedman=== | ||
Revision as of 05:01, 14 January 2009
Economists on the crash
Galbraith
Galbraith's best-seller "The Great Crash 1929 [1] was probably responsible for the popular belief that the crash was the consequence of the bursting of a speculative bubble; and (although it did not say so) the belief that it had caused the Great Depression. He argued that the stock exchange boom had been due to misplaced confidence in the prospect of perpetually and increasing prices - confidence that had been bound to weaken at some stage - and that when that happened and some people began to sell, the illusion had been destroyed, provoking a rush to unload. His account of immense bursts of buying, mostly on the margin, give a convincing impression of furious speculation, and he makes it clear that that was the view of the authorities at the time - who come in for criticism for not taking convincing action to curb it.
McGrattan
found that, on conservative estimates, the market value of U.S. corporations was no greater than 19 times corporate earnings (or 1.67 times GNP), and the fundamental value of U.S. corporations was no smaller than 20 times corporate earnings (or 1.78 times GNP) [2].
Friedman
Bernanke
References
- ↑ John Kenneth Galbraith: The Great Crash 1929, Penguin Books, 1992
- ↑ Ellen McGrattan: The Stock Market Crash of 1929: Irving Fisher Was Right!, Federal Reserve Bank of Minneapolis, Research Department Staff Report 294, December 2001[[1]]
- ↑ Milton Friedman and Anna Schwartz A Monetary History of the United States 1867-1960, Princeton University Press for NBER, 1963
- ↑ Ben Bernanke: Asset-Price "Bubbles" and Monetary Policy, speech at the New York Chapter of the National Association for Business Economics, October 15, 2002[2]