Not only life was different in the Roaring Twenties - financial markets were quite different as well. Many rules that are in place today to protect investors from stock market manipulations did not exist and information was not equally available to everyone - an uneven playing field. Most people knew this, but were nevertheless attracted by the attractiveness of this volatile, yet steeply growing market that within a decade went up by almost 600% before crashing in an unprecedented way:
Buying and selling stocks in the 1920s
We're used to a great modern convenience, the internet. Without it, many things, including trading stocks becomes much more difficult.
Wait in line before trading - 1920s stock brokerages
When a normal person wanted to buy or sell shares, they had to run to the next broker and sometimes wait in line before making their trade:
News, hours after they happened: Your 1920s paperboy
News spread much slower than today. After an important market event, newspapers usually printed a so-called "Extra" to distribute via paperboys selling them on the street. That meant that normal investors would learn about important events such as a crash later than professionals on the famous New York Wall Street.
A recurring theme in world history: Market crashes
Something that never seems to change is that markets run in waves, up and down and sometimes an exuberant market comes back to normal with a giant crash. We have seen that not only in 1929, but also the 1980s and the 2000s.
The crash of 1929
The irrational exuberance of the 1920s found its end on October 29, 1929, when the Dow Jones Industrial Average fell -12%. Black Tuesday is often called as the beginning of the Great Depression. Banks had tried to prevent the market from falling already a couple of days before by actively buying shares to prop up prices, but ultimately could not stop the market from falling. Crowds started gathering around Wall Street to learn of the events first hand. Some people even committed suicide, because they had borrowed money to buy stocks and were now bankrupted.
Great documentary about the 1920s stock market and the crash of 1929:
Little Traders and the 1920s stock market
In Little Traders you enter the fascinating world of the 1920s and its stock market. Once you have built a lobby and hired a paperboy, you'll have access to news extras that really influence the price of the stocks you can buy and sell in the game.
The companies you can trade are are based on the industries available to investors at the time:
- mass communication
- food & beverages
- first electric household devices
We have taken the liberty to actually present you digital charts that you can trade on so that the skills you learn in the game help you in real life once you decide to invest in the real market today. The way the prices move is realistic, based on our own algorithm that simulates a real market environment.
Your little clients are demanding: they expect you to obtain high returns for them on a daily basis, because in the 1920s many people became very rich on the stock market before often losing everything in the crash. Some people however also made money. It's your responsibility to guide your Little Traders wisely and achieve the goals for your little clients, but you are not alone: there are many experts in the game that will help you learn and become a better trader and investor.