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Rainbow's End: The Crash of 1929 (Pivotal Moments in American History)

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Maury Klein, in his book Rainbow's End: The crash of 1929, has given us a blend of a newer style of historiography with the traditional sense of examining historical events. He has given us a look at the Stock Market Crash of 1929 through the eyes of the people that participated, rather than looking at it strictly from an economic or political historical viewpoint.

Klein starts his book with a description of American society in the 1920's and explains to us why the society of excess and speculation led to the crash moreso than a failing of the general American economy. By dotting the landscape with characters, some familiar and some unfamiliar, Klein gives us a good portrayal of the times.

There is, unfortunately, only a short section of the book that actually deals with the events of the crash itself. This section focuses the days between Black Thursday and Bloody Tuesday, which culminated in a horrific period of losses in the market.

Klein does a good job of staying on task during the sections of the book in explaining the economic factors and the behind-the-scenes actions that took place during these few hectic days. He does not, however, explain the immediate social ramifications (such as the fact that people who lost everything gave up on life) as well as might be expected; he gives this facet of the crash only peripheral coverage.

I would recommend this book to anyone that is looking for a socio-economic history of America during this 1920's. It does a very good job of covering this topic. However, if one is looking for details just on the crash itself and those few terrible days on Wall Street, that reader would be well served to find another book to read.

As someone who is interested in economics, financial markets, and business, the stock market crash of 1929-1932 has always grabbed my attention in those terms. As a result, my favorite book on the events leading up to the stock market melt down is John Kenneth Galbraith's famous book, The Great Crash 1929. Having recently reread that book to contemplate the stock market melt down of 1999-?, I was interested to see what lessons could be drawn from that experience to this one from reading this book.

As a work of psychological history, Professor Klein was hampered by the lack of survey and sentiment indices. As a result, he relies a great deal on what prominent people had to say and what they did. As a result, the bulk of the material repeats what Galbraith covered. To this material are added thoughtful observations about trends in popular expenditures for automobiles, interest in sports (especially baseball), fads (such as flag-pole sitting), modern marketing (including advertising through movies and radio), and the acceptance of installment purchasing.

He picks up a number of individuals who represent different "types" who experienced the stock market crash, to help us see how the effects varied from person to person. Groucho Marx saw himself lose money he could regain through future earnings, while others saw themselves wiped out for all time. Both Charley Mitchell (no relation) of National City Bank and Jesse Livermore provide cautionary tales. I was fascinated by Professor Klein's thoughts about how Herbert Hoover was caught in a dilemma between his desire to help and his strong feeling that government should be kept small.

This notion of focusing on the psychological change though would apply much better to the Great Depression itself than to the stock market crash. Since I was a child, many people have told me about how the Depression changed their outlook on life. Whenever I asked them about the stock market crash as a cause of a changed perspective, they said it had no impact. As Professor Galbraith points out, the number of stock investors was less than 2 million in those days. The stock market crash was a background event for most people, albeit an important one since a very high percentage of consumer spending was done by the wealthiest people, as Professor Galbraith points out.

Ultimately, this history has too little economic, financial, and business perspective to fully capture what this event means. I suspect that it will not be widely read, even though the information and the analysis are perfectly fine as far as they go.

How can we modulate the swings in investment emotion that cause markets to rise too high . . . and fall too low? What will we lose if we do?

Rainbow's End, by Maury Klein could have been a good book. In fact, it should have been a great historical read about America during the Roaring Twenties, leading up to and precipitating the Crash and the Depression. But Klein falls far short and disappoints with this entry into the "Pivotal Moments in American History" published by the Oxford University Press. This volume seemingly couldn't decide whether to be decidedly research based or, as with others in this series, to be a narrative form "that can be read for pleasure and instruction by anyone with an interest in its subject", according to it editors, David Hackett Fischer and James M. McPherson.

The book's prologue "The Summer of Fun, 1929" is clearly its highlight, certainly a dubious distinction. "In the summer of 1929 much of America was on an artificial high. It was a high born not of drugs but of an illusion that the prosperity and the good times then being enjoyed were made of new miracle ingredients that would last forever." Klein paints a vivid portrait of life in America in his early pages but sadly does not follow along in that form.

Throughout the book the reader cannot help but think that this is more of a reporter giving much more detail than needed, literally day by day of the Dow and the New York Times Index, often in the absolute and without percentages so one gets a relative idea of what was going on. Additionally, and quite strangely, Klein doesn't weave into his writing the many causes of the Crash and also poorly differentiates between the Crash and the Depression. One gets the idea that if he were to take out long and seemingly unrelated passages such as one on Evangelist Aimee Semple McPherson and much of the above mentioned ticker tape readings he would have had ample room to discuss not only the causes and effects of the Crash but also would have been able to maintain the narrative style in the beginning of Rainbow's End.

To Klein's credit he does a very good job with the Coolidge and Hoover administrations and in his discussions on the nascent stages of the Federal Reserve. He also drives home the point of a much smaller federal government role in the years prior to FDR and its lack of ability to "rescue" a calamitous market and the resultant depressed economy, "Federal purchase of goods and services totaled about 1.3 percent of GNP and federal construction a tiny 2 percent, hardly enough to serve as a prime stimulant".

Perhaps the saddest part of this writing is that, in its current form, much could be done to improve it. Little to no additional research is needed. Just a rewrite and more color and less droning on and on about redundant economic and market statistics. This book, in its research and obvious talents of its author, fails to make an interesting topic captivating to the reader. Clearly a laggard in this fabulous series.

This book is not bad, but it is a little disappointing. Both Galbraith's The Great Crash 1929 and Frederick Lewis Allen's Only Yesterday: An Informal History of the 1920's were written within a couple of years of the Crash, and are arguably (1) better written and (2) more tightly constructed. For sheer detail of the financial world, either Galbraith's book or the original Pecora Report from Ferdinand Pecora and the congressional committee that investigated the causes of the crash (The Pecora Report: The 1934 Report on the Practices of Stock Exchanges from the "Pecora Commission") would be better matches and more interesting reads.

"No era ever vanished so suddenly, so completely, as the
twenties." -- -- David Dempsey, _New York Times_, Feb 15, 1970

This is a quick run-through of the Crash, with a little pop-sociology about America in the Twenties. It's eerie, reading quotes from bankers, politicians, and brokers from the months before the Crash, about how the market had become so modernized and shockproof that panics were now impossible. Sounds familiar...

New York Times financial columnist Alexander Noyes is a primary source in this book. It is fascinating, watching these titanic events being filtered daily through this not-stupid man's pen. We've heard more than 70 years of second-guessing about the Crash by now, so it is interesting seeing how it was taken point-blank by analysts at the time.

In Maury Klein's account, the Crash is nobody's fault. Like Stanislaw Lec once said, every snowflake in an avanlanche pleads not guilty. Big brokers ostentatiously placed big orders, hoping to spur rallies. Consortia of financiers struggled to maintain public confidence in the market. President Herbert Hoover-who as a humanitarian first and failed President second was Jimmy Carter in reverse-tried to get Big Business together in a game plan to retrieve the situation. But in a free market, there is no one pulling levers and hauling cables controlling things. There was no one to stop the free market from going into freefall.

Throughout the book are amusing little vignettes, like the man who sat smiling in his broker's office throughout Black Monday. His termagant wife wouldn't be able to nag him about the neighbors doing better in the market than him anymore...

Klein's retelling of the story of the stock market crash of 1929 is just too little and much too late. Other books, notably Only Yesterday by F.L. Allen for anecdotal material and The Great Crash of 1929 by J. K. Galbraith for analysis, go over the same material and do a better job. Klein's book does have some strong points: wonderful vignettes of some of the people, big and small, who were caught up in the crash; a good analysis of why Herbert Hoover, "the great engineer," couldn't engineer his way out of this one; some interesting anecdotal material I haven't seen anywher else. But all of that could have been done in less than half the space. Nice try, but no cigar.

At Rainbow's End provides a succinct yet through look at the Great Depression and how it changed life in America. By tracking the prosperities of the 1920s and the rise of consumer culture the reader gets a clear picture of the investment frenzy that gripped the nation. The over valuation of stocks and the financial crisis is clearly laid out in laymen's terms with an overview for those who want the technical financial explanation. It tracks interesting vignettes and mini biographies of major players and how they affected and were changed by the depression. It does not look at the solutions to the depression, only the causes. This is an average entry into the Pivotal Moments in American history. The problem is that this is such a no brainier event for the series that it does not take much convincing and this book does not try to do so. Instead it tries to give a social perspective which while new and different may not excite all readers. It is still a great book and one that provides a new perspective. For those interested in the roaring twenties it is a great book to look at.

I have to admit I am a bit biased since I am interested in the Stock Market and especially the present market's similarity to that of the time referred to in the book. But, it's a lot more than that! It is very well written and though it probably is written for those 11th grade and higher, it is easy to read. It is loaded with real-life history. My wife has already completed it and I am part done. We plan on having our oldest four children read it. The prologue on the 1929 summer seemed to place you right there--even though I never visited New York City itself. My wife mentioned it made the stock market easy to understand especially margins and short selling. I think she also mentioned puts and calls, which is the one area of the stock market I would like more practice with. If you are into history or want to really learn about the market, this is the best place to start. Highly recommended!

Tom from Michigan

Since college I have been an active reader of causes for the crash. Nothing in my text books can compare with the facts in this book. There are so many parallels to our current situation and the run up to the crash. It is easy reading for so much history. It dispells the myth that business will regulate itself without government oversight by an unbiased presentation of the facts and allows you to draw your own conclusions for what went wrong. It is a must read for those interested in preventing this from ever happening again. Brokers were paid huge bonuses in 1930 because of their large number of trades in 1929.

Maury Klein's Rainbow's End: Crash Of 1929 reveals the story of the Wall Street stock market collapse in 1929 using a narrative which focuses as much on the cultural and economic forces at work during the times as it does of the actual crash and the nation's descent into depression. Was the crash an unusual event in which coincidence played more than a small role? An intriguing argument is presented, here.