“This September feels a lot like autumn 1929,” read an op-ed from this Saturday’s Wall Street Journal. Several other publications have made the same comparison: AlterNet asked, “Are we on the verge of a repeat?” The Daily Mail wondered what we can learn from events in 1929 to help us “avoid a 21st Century Great Depression.” If things are really as bad as that, how come we aren’t hearing about executives jumping out of windows?
Because the current situation hasn’t had nearly as devastating an effect on people’s personal finances. The Great Crash of 1929—and, to a lesser extent, the crash of 1987—did lead some people to commit suicide. But in nearly all of those cases, the deceased had suffered a major loss when the market collapsed. Now, due in large part to those earlier experiences, investors tend to keep their portfolios far more diversified, so as to avoid having their entire fortunes wiped out when stocks take a downturn. In addition, some of the worst declines in the past week have been limited to a smaller number of companies (such as Lehman Bros., Morgan Stanley, and Goldman Sachs), further limiting the potential damage to individual investors.
Tall tales about panicked speculators leaping to their deaths have become part of the popular lore about the Great Crash. But although jumping from bridges or buildings was the second-most-popular form of suicide in New York between 1921 and 1931, the “crash-related jumping epidemic” is just a myth. Between Black Thursday and the end of 1929, only four of the 100 suicides and suicide attempts reported in the New York Times were plunges linked to the crash, and only two took place on Wall Street. (There were some crash-related suicides that didn’t involve fatal jumps: The president of County Trust Co. and the head of Rochester Gas and Electric both killed themselves, but they used a gun and gas, respectively.)
An urban legend about the suicide outbreak seems to have sprung up almost instantaneously. On the day after Black Thursday, the New York Times reported that many “wild and false” rumors were spreading throughout the country, including claims that 11 speculators had committed suicide and that a crowd had gathered around a Wall Street building because they thought a workman was a speculator preparing to jump. That same day, Will Rogers quipped that “you had to stand in line to get a window to jump out of“; and soon Eddie Cantor was joking that hotel clerks were asking guests if they wanted rooms “for sleeping or jumping.” By mid-November, New York’s chief medical examiner tried to put the kibosh on the rumor by publicly announcing that there had been fewer suicides between Oct. 15 and Nov. 13 than there had been in the same period the year before. (Winston Churchill—himself a major stock-market investor—may have added to the rumor mill: He was in New York during the crash and, in a December 1929 Daily Telegraph article, recalled how, under his own hotel window, “a gentleman cast himself down fifteen storey and was dashed to pieces.”)
The two Wall Street leaps that did take place, however, were dramatic enough to sustain the myth. On Nov. 5, Hulda Borowski, a clerk who’d been working at a Wall Street stock brokerage house for 28 years, leapt off a 40-story building. On Nov. 16, three days after the market had taken another dive, G.E. Cutler, the head of a produce firm, climbed onto the ledge of his lawyer’s office. The New York Times reported that an attorney struggled to pull the frantic Cutler inside, to no avail:
For a moment the men fell apart, then Mr. Cutler lunged over the edge. [The attorney] seized the tails of his coat, but his grip broke. Cutler’s body crashed on to an automobile with New Jersey license plates parked near the junction of Wall, Pearl and Beaver Streets, and bounded to the pavement.
In the week following the 1987 stock-market crash, at least two suicides in the United States were linked to the crisis, but none involved a window plunge. (One of the incidents was a murder-suicide in which a distraught investor in Miami killed a Merrill Lynch executive and then himself.) There were also rumors that the Pacific Stock Exchange had asked Golden Gate Bridge officials to be on alert for jumpers, but the stock exchange denied the claim.
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Explainer thanks James Ledbetter of The Big Money and reader Brian Boddy for asking the question.