Customer Reviews

The Great Depression: A Diary

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What makes this book important are its clear similarities to the events of today. In fact, it's hard to read the book and not get the two eras a little confused. Bank closings? Check. Recovery Act bills and government spending? Check. Bankruptcy? Check. Foreclosures and federal foreclosure prevention programs? Check. Partial and full takeovers of industry? Check. Smaller paychecks every year? Yep. (While the editors admit to the release of the book being spurred by the current economic crisis, the cyclical nature of this type of event means the book would actually have been just as important in 1999 or 2006 as it is today.)

Beginning in June 1931, Benjamin Roth recorded in a series of notebooks his observations on the events in Youngstown, Ohio. Highlighted are the sad state of his legal practice throughout the depression years, bank closings and reopenings, steel production levels, growth in the ranks of the unemployed, and extreme deflation in the early years of the depression. Though having no investments of his own, Roth recorded stock prices and dividend payments, and much of the discussion surrounds the best way to have invested if he had been able. Roth worries most about a period of strong inflation spurred by the policies of the Roosevelt administration and about middle-class professionals such as him being bypassed by the growing recovery, but also about the anti-Semitism of the campaign by Republican Alfred M. Landon in the 1936 presidential election, Hitler's takeover of Europe, government control, socialism, losing the gold standard and the rise of organized labor, especially when it led to strikes and violent confrontation in Youngstown. He worries, too, about collecting what is due his practice without causing hardship.

I know little about investing, but Roth's progression through the years of the depression is evident. At first, he believes that government bonds would have been the only safe strategy; later fears of inflation push him toward stocks, preferred and common. When the recovery stumbled greatly in mid 1937, he comes to believe that only having a pot of cash available and shifting among different strategies the follow the curve of boom and bust is prudent. In the end, he aligns himself somewhere between the speculators who he blames for the crash and the long-term, bonds-only investor he would have been earlier in the crisis.

Roth's theorizing about investment strategy is nothing more, because he is too short on cash to do anything with his ideas. (While the book offers few details, the late 1940s and following decades were more profitable for Roth and his law office, which is still in operation with his son and editor at the helm. Roth and his wife also left behind the Benjamin W. and Marion B. Roth Foundation, a charitable organization.) What he offers in addition to his hypothetical musings on where to allocate non-existent savings is a picture of depression-era concern and struggle among the middle, professional class -- not the union workers, not the migrant fruit pickers and not the stockbrokers driven to despair by losing everything. It is an important perspective.

The parallels to today are rampant, despite the obvious changes over the years. I find it hard to sympathize when Roth complains that only the working class is getting the benefits of the recovery, this due to federal requirements for shorter work days, increased pay and recognition of unions. The fear of socialism because of government spending I do not share, but many do today; bold government spending is what ended the Great Depression, though only when war gave the administration full license to do so. What I do share with Roth is resentment of those who play with the market as speculators, not as investors. He makes that distinction clear, and the blame is just as evident. Along with deregulation, those speculating in real estate, bad real estate loans and petroleum futures share a great deal of the responsibility for the fact that millions of us now make less money than we did two years ago, and that college graduates cannot find jobs, and that many formerly employed no longer have any job or are working well beneath their abilities. Yet he leaves room in his view of the market for a person not to hide his savings away but to invest it in growing business and government bonds, putting it to work while reaping the benefits -- but in a way that is both responsible and prudent.

I read this book in 24 hours. The format of short diary entries combined with the thrill of following the ups and downs of Roth's community and the country in light of today's situation made it easy. I'd recommend you pick it up and do the same.

As a child of the Depression I found The Great Depression: a Diary very interesting and informative. My father was not a professional person and I am sure he did not have any stocks, but the traumatic events that occurred happened to everyone. There are so many similarities to todays events: bank closings, credit problems, the closing of so very many businesses and the institution of so many programs to save jobs and the economy and very few of them having the stimulus needed. I also found it interesting to track the professional person as I have worked for lawyers and they seem to suffer immediately from a downturn in the economy. Apparently it was the same many years ago. A very good read and I would recommend it to anyone who lived through the great depression or would like a comparison of the present situation and the dark days long ago.

I purchased The Great Depression: A Diary after reading Joe Nocera's excellent column about the book which appeared in the New York Times on October 17th. I was most impressed by the book and recommend that it be placed on everybody's list. It would be a great Christmas present for anyone old enough to have lived during the Great Depression, and an eye-opener for those who are struggling to make sense of our current economic situation. As it has been said, "Those who ignore history are doomed to repeat it."

I found the book hard to put down and believe that it has great historical value. We have all read histories of the Depression, but to read the day-to-day account of a young lawyer who was living it in real time is unique. It was amazing to me to be able to follow the history as it was being made, and it gave me much greater insight into how the so-called middle class suffered. I give it my 5 star approval.

I've always wondered why people who emerged from the Great Depression are so different than my generation (boomer). They are more nervous, cautious, a bit fearful, but way more sensible than the carefree, debt-ridden generations that were born after the depression ended. When someone says, "my folks lived through the depression" you know what they're like. Forever changed, savers, and never crazy with investments.
So the chance to read a nunc-pro-tunc account of what daily life was like to a person living in the Great Depression, it's a fantastic historical opportunity to enter a time capsule with such granularity and texture that you feel like you are there.
But what's haunting is the similarities of life then to life today. Phantom ups and downs so the unaware public is being convinced that the worst is over, when in fact, history showed that it was only going to get worse. The government bailouts, and the fear of inflation. In many ways reading this book is like reading today's papers.
Scary and enlightening - it's a great piece of american history.

. . .in the end it doesn't deliver.

I was excited about this book as it a new primary source about a pivotal period in economics that remains controversial. While we have many accounts of the Depression, they were written after the events they describe and generally with strong points of view. This is a diary written contemporaneously by a man who didn't know how things would turn out, and wrote to help himself make sense of events rather than to convince others of a preconceived opinions.

The first disappointment is the book contains virtually nothing about life. Only a few period details slip in; learning about the major local banks closing through newsboys shouting "Extra" at four o'clock in the morning; movie theaters cutting costs by eliminating vaudeville acts between features. There is nothing personal, not even personal economics: did he have accounts frozen at banks, did he hoard cash, what cutbacks did he make when times got bad, did he use script or barter when banks were closed? As a result, non-financial history buffs will find nothing of interest, and the book is very dull.

I think this led the published reviewers and also M. Stewart to exaggerate the similarities with today's events. The author records only a few bits of economic data: downtown real estate vacancies, prices of half a dozen stocks and capacity utilization at local steel mills. At that superficial level, all business cycles seem the same. Once again, there are a few interesting bits. The double liability of bank shareholders seemed to be a major impediment to equilibrium and local property taxes based on pre-Depression appraisals forced the demolition of useful buildings. Depending on your politics, you can read this as evidence that government economic interference exacerbated the Depression, or that the government should bail bankers out and accept deficits as the price of restoring economic health. Another difference that gets noted in passing is holdover personal debts from the 1920s and early 30s meant many of the middle class people the author describes had negative net worth as late as the end of the decade, something today they would either discharge through personal bankruptcy or settle earlier in one way or another.

The book provides a test of Nassim Taleb's narrative fallacy. He argues that people define eras after-the-fact, then write histories which ignore everything unrelated to that definition as irrelevant, and thereby present neat cause-and-effect stories of reality that is far more chaotic. This diary has to be considered contrary evidence. The author knows from the beginning that he's living through the Depression, and records the same type of economic information and events that figure in the histories. "The depression" is all he ever calls it, although it had many different contemporary designations, and he always dates it from the 1929 stock market crash. He mentions the major national and world events remembered today, and no others. In August 1940 he refers to Germany's "blitzkrieg" against England, although what was later named the "London Blitz" did not begin until the next month. Taleb might argue that is why this diary was published and millions of others ignored, or perhaps that the coherence was introduced in the editing process. But taken at face value, this book says the Depression was a lot like what history books describe.

However, little of the book is concerned with large events. The constants are complaints about how little money he was making practicing law, calculations of how rich you could get if you bought at low prices and sold at high ones, and stories of people who went broke buying at high prices and selling at low ones. The reasoning is shockingly superficial for an intelligent man who spent a decade thinking about things, he drifts from one pompous non-actionable theory to another, without acknowledging the shifts.

He relies on undefined moral terms, you are supposed to make "prudent" investments in "first class" securities selling below "intrinsic value" and sell when speculative fever heats up. Of course, if you lose money you bought imprudent second-class securities above intrinsic value during rampant speculation. There is no concept of statistical risk, no theory of value or equilibrium, no economic reasoning; just childish regret that it is impossible to transact at historical prices. Of course, he is not the first person to be tantalized by stock prices going up and down, and how easy it seems to be to make or lose money, but he may be the smartest person to spend ten years thinking and writing about it without digging deeper. He is a perfect illustration for the definition of the stock market addict William Worthington Fowler penned sixty years earlier: "'If' and 'but' are the most frequent conjunctions in his vocabulary. His whole life is a series of regrets, and strange to say, these regrets are more often for what he might have made, but did not, than for what he has actually lost."

read this book if you want to fathom what is going on today - it gives a extremely useful perspective on today

Benjamin Roth's first hand account of The Great Depression from 1931 to 1941 was a very fascinating and personal read that provided not only historical perspective on the events of the time, but also a friendly voice and opinion of the days events.

What really set this book apart for me was the authors first hand account of events as they unfolded, versus most historical accounting of the period which are mostly a retrospects. Mr. Roth fills us in on current events as they unfolded in America during the time, his opinion on the situations (which leaned conservative) and his predictions. A fun bit of the book is that Mr. Roth would actually go back and review entries and add updates such as "These predictions turned out to be completely wrong.".

I think this book also hit home for me due to the financial situation we're currently going through these days in America. You read about Mr. Roth's trepidations towards FDR and his "New Deal", constantly warning of out of control government spending and the impending inflation boom (which never came).

My wife and I were talking and this book seems to beg the question of what would have come of the American economy if World War 2 hadn't started. Would we have continued on a downward spiral of inflation? It's not fun think about but I really feel that this book paints an accurate (if not a bit biased, but as to be expected with the nature of the account) of The Great Depression and how it impacted Main Street America. (show less)

I could not put this book down. I read it in two days so my wife could read it. It is a telling view into our past.It is uncanny how the present mirrors what happened in the 1930's. A must read.

This book is authored by a good friend, and he referred me to it after not seeing him for some years. The product I chose was a "used" edition and it came in perfect, unused condition. The book itself is incredible, a personal diary of the great depression with personal insights literally by the day. I would recommend it to anyone interested in business or the history of our country.

BOOK REVIEW: Benjamin Roth's 'The Great Depression: A Diary' Brings Nation's Greatest Financial Meltdown to Life

Reviewed By David M. Kinchen

The 'forgotten men' of today are the doctors, lawyers, insurance men, etc. They are down and out and can do very little about it. -- Benjamin Roth, diary entry Nov. 10, 1933

Image removed by sender.That refrain -- echoing Franklin D. Roosevelt's "Forgotten Man" radio speech of April 7, 1932, when he was still governor of New York -- runs through Benjamin Roth's "The Great Depression: A Diary" (PublicAffairs, $15.95 quality paperback, 288 pages, edited by James Ledbetter and Daniel B. Roth, with an introduction by Ledbetter) much as the Mahoning River runs through Roth's hometown of Youngstown, Ohio.

Benjamin Roth was born in New York City in 1894 but he moved with his family while still very young to Youngstown. He received a law degree and moved back to Youngstown after serving as an army officer during World War I. When the stock market crashed in 1929, he had been practicing law for about ten years, representing local businesses for the most part. After nearly two years, he began to grasp the magnitude of what had happened to American economic life, and he began writing down his impressions in a diary that he maintained intermittently until he died in 1978.

Youngstown, midway between New York City and Chicago and about halfway between Cleveland and Pittsburgh, was a thriving industrial city of about 170,000 people at the time of the October 1929 stock market crash. Today it has about 78,000 residents, with legendary employers like Youngstown Sheet & Tube Co. long gone. (A personal note: I worked in the quality control department of YS&T's mill in Lake County, Indiana for about a year in the mid-1960s, before I joined the reportorial staff of the Hammond (IN) Times in January 1966). If Pittsburgh and Chicago were the centers of Big Steel, Youngstown was home to "Little Steel" companies like Youngstown Sheet and Tube and Republic Steel.

Most of the entries cover the period from 1931 to the end of 1941, after the Pearl Harbor attack and the declaration of war against the U.S. by Hitler's Germany and Mussolini's Italy on Dec. 11, 1941. Roth interjects brief updates with dates in the 1940s, 1950s and even the 1970s, and the editors provide background essays to explain some of the events Roth writes about. All in all, the package is an excellent brief introduction to the Great Depression, with anecdotes that will resonate with today's readers.

In addition to his comments about the lack of work for lawyers, doctors, dentists and other professionals during the entire period of his evocative diary, Roth records the travails of working class people at a time of industrial strife and massive unemployment. He doesn't neglect the plight of farmers in Ohio and other Midwestern farm belt states, including the epicenter of farm foreclosures, the state of Iowa. Roth devotes a great deal of space in his diary to real estate, which must have been a big part of his law firm's business before October 1929 -- and very little after with the almost total collapse of the nation's real estate industry.

Roth was a Republican who voted for Hoover's re-election in 1932 when FDR won in a landslide, and for Alf Landon in 1936 when FDR swamped Landon in an even bigger landslide. In 1940 Roth campaigned for GOP Presidential candidate Wendell Willkie on a "no third term" for FDR campaign. Although he worked for the Mahoning County NRA, his beliefs that the New Deal was a socialist plot against America pervade the diary. Like people today, Roth struggled to understand how the world's largest economy could collapse so quickly after the events of October 1929. He obviously had plenty of time to read sitting in his frequently empty law offices and he cites dozens of books that he perused to educate himself about finance, investing and economics.

Here's Roth's entry for March 8, 1933, four days after FDR's inauguration:

We are greeted by a very dramatic announcement this morning. At 1:30 a.m. this morning as his first official act, President Roosevelt issues a proclamation ordering every bank in the United States to close for four days -- including the U.S. Treasury and the Federal Reserve Banks. It now appears that during the past two weeks foreign countries and domestic depositors have withdrawn gold from the U.S. Treasury at an alarming rate. This proclamation also forbids exportation of gold. As a result of this announcement the U.S. will be technically off the gold standard for four days. I don't see how the government can resume gold payments at the end of that time because all Europe will be waiting at the Treasury doors to withdraw gold. In Youngstown every bank and loan company is closed to all business and large placards in the windows bear notice of the President's proclamation. Everybody is fearful of the immediate future. In the meantime all over U.S. plans re (sic) going forward to issue scrip against bank deposits. Likewise every stock exchange in the country is closed.

It's important to remember than before the passage of the Banking Act of 1933 -- commonly called the Glass-Steagall Act for its congressional sponsors -- later in 1933, there was no federal insurance on bank deposits. Glass-Steagall separated "boring" commercial banking and "risky" investment banking and created the Federal Deposit Insurance Corp. Most of Glass-Steagall was discarded in the latter part of the Clinton Administration, but the FDIC was retained.

The repeal of the Glass-Steagall Act of 1933 effectively removed the "Chinese Wall" that previously existed between Wall Street investment banks and depository banks and has been blamed by some -- including the present reviewer -- for exacerbating the damage caused by the collapse of the subprime mortgage market that led to the current financial crisis.

About the editors: James Ledbetter is the editor of "The Big Money," [...] Web site on business and economics. Prior to joining Slate, he was deputy managing editor of [...]a financial news site. His most recent book is Dispatches for the New York Tribune: Selected Journalism of Karl Marx. He is also the author of Starving to Death on $ [...]: The Short, Absurd Life of The Industry Standard and Made Possible By...: The Death of Public Broadcasting in the United States. He lives in New York, NY. Daniel Roth is a son of Benjamin Roth and is the chairman of the law firm of Roth, Blair, Roberts, Strasfeld & Lodge in Youngstown, Ohio. He is the co-founder of National Data Processing Corporation and the co-founder, Chairman and CEO of Torent, Inc (formerly Toro Enterprises, Inc.) He divides his time between Youngstown, Ohio and Florida.