Financial Crash Impacts a Tiny Island

 _By Tiffany Amber Stockton

There has been a lot of talk of financial struggle and hardships lately, what with the ever-rising inflation and prices nearly double what they were 2-3 years ago. My family has had to make some significant changes to preserve as much of those hard-earned dollars as possible, and I'm sure a lot of you who are reading this have had to do the same.

Although it's not as bad as the Great Depression, there have been definite ways my local community has come together to help each other through these tough times, sharing the burden and lightening the overall load. That's what communities should do.

Island Life During the Great Depression

The Great Depression was the longest and most devastating economic downturn of the 20th century. Spanning much of the 1930s, it shook not only the United States but the entire world.

The crisis began in the U.S. after the stock market crash of October 29, 1929—“Black Tuesday.” Within just three years, global GDP dropped by an estimated 15%. By comparison, the so-called Great Recession of 2008–2009 saw worldwide GDP fall by less than 1%. The contrast is staggering, yet many today mistakenly believe the two were on the same level.

Unemployment in the U.S. soared to nearly 25%. Personal income, tax revenues, profits, and prices all collapsed. With jobs scarce, families had to adapt quickly, often leaning on creativity, hard work, and each other to survive.

Island Ingenuity in Hard Times

On Chincoteague Island, poultry farming grew rapidly during these years. Families raised chickens not only to feed themselves but also as a source of trade and income. By 1950, the island was producing more than one million birds each year.

This was also when two devastating storms forever changed the landscape of both Chincoteague and Assateague Island. With 18 inches of flooding and the highest tide ever reported, a new inlet was carved out of the barrier island just south of Ocean City, Maryland, destroying a railroad bridge and dragging railcars out into the ocean.

Wages remained mostly steady, but many employers couldn’t keep as many workers. That meant every able family member pitched in. My grandfather was only 13 when he stood beside his father behind a barber’s chair, cutting hair to help feed his nine brothers and sisters. Customers often paid with food or by bartering services when money was scarce. Shellfish were a common exchange of goods for service on Chincoteague.

Harvesting the Land and Sea

Oystering, clamming, fishing, and crabbing weren’t just pastimes on Chincoteague, though. They were lifelines. The bounty of the sea was sold, eaten, or exchanged for other necessities. Hunting ducks and waterfowl also supplemented the food supply, and handmade wooden decoys became a useful and profitable tool. Those decoys remain cherished collectibles from the island today, and you can see them in several shops on Main and Maddox Streets.

Clothing and shoes were patched and repurposed until they could no longer be worn. My great-grandfather even cut old tires into strips and tied them to the bottoms of his children’s shoes to reinforce worn-through soles. Nothing went to waste.

Lessons We Can Still Learn

Perhaps the greatest lesson from the Great Depression is that hardship often drives people closer together. On Chincoteague, bartering, skill-sharing, and mutual support were the rule. These days, it seems to be the exception and a rather foreign concept. I'd love to see America return to this.

Those who endured learned to live simply, save diligently, and give generously. Many continued those frugal habits for life, building enough wealth to enjoy their retirement and even leave inheritances for their families.

When I look around today, I can’t help but notice the contrast. Even after paring down and simplifying our home, we still live with far more than ten families combined might have had during the Depression. It’s rather humbling, but it also reminds me to live with gratitude rather than excess.

NOW IT'S YOUR TURN:

* If you had to trade your skills or services instead of using money, what would you offer?

* What’s one “make-do” or frugal practice you learned from your parents or grandparents?

* When life gets hard, do you tend to lean on community, or try to go it alone?

Leave answers to these questions or any comments on the post below.

** This note is for our email readers. Please do not reply via email with any comments. View the blog online and scroll down to the comments section.

Come back on the 9th of each month for my next foray into historical tidbits to share.

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BIO

Tiffany Amber Stockton has embellished stories since childhood, thanks to a very active imagination and notations of talking entirely too much. Honing those skills led her to careers as an award-winning and best-selling author and speaker, while also working as a professional copywriter/copyeditor. She loves to share life-changing products and ideas with others to help them just get rooted and live a life of purpose.

Currently, she lives with her husband and fellow author, Stuart Vaughn Stockton, along with their two children, two dogs, and five cats in southeastern Kentucky. In her 20+ years as a professional writer, she has sold twenty-six (26) books so far and has agent representation with Tamela Murray of the Steve Laube Agency. You can find her on Facebook and GoodReads.

Black Tuesday: The Day the Stock Market Crashed

By Michelle Shocklee

October 29, 1929 seems like a very long time ago. Yet to put that date into perspective, my dad was born in 1921 and my mom in 1927. They were children when the stock market crashed and ushered in the worst economic depression in our country's history. 

But I'm getting ahead of myself. To understand what led to the stock market crash, let me take you back to the beginning, before there was a stock market in the United States. 

Alexander Hamilton

Back in the late 1700s, available stock was limited to insurance companies, the Bank of New York, and the new First Bank of the United States and its "Hamilton Bonds" which were bonds Secretary of the Treasury Alexander Hamilton issued to deal with America's Revolutionary war debt. Unlike today's stock market, early buyers and sellers were not trading shares in a company. Instead, they dealt with government securities, businesses securities, and individual debt. Trading took place in a coffee shop or out on the street.

Interest in the newly formed bank stock was high at first, which increased the price to a whopping $280 by August 1790. The price wasn't sustainable, and a small crisis took place that required Hamilton to step in with government money. The market rebounded in December 1791 only to crash in March 1792.

Why this up and down in the market?

Because unscrupulous speculators like William Duer and others like him obtained huge loans from banks and individuals, bought up government securities and bank stock, then hatched schemes to sell at a profit to foreign investors. Quite simply, William Duer was Wall Street’s very first insider trader, and the man behind the Financial Panic of 1792. Duer's system failed miserably, sending stocks crashing when they could not maintain their inflated value. Duer, for his part in the whole mess, went to prison, but that didn't help investors.

Fed up with Duer and the others, twenty-four stockbrokers and merchants decided something must be done. Famously, they met beneath a Buttonwood tree and formed a centralized exchange for the burgeoning securities market in the United States. The agreement eliminated the need for auctioneers—used frequently for wheat, tobacco and other commodities—and set a commission rate. The organization made the Tontine Coffee House its headquarters and focused on government bonds.

The signing of the Buttonwood Agreement on May 17, 1792

The Buttonwood Agreement read: We the Subscribers, Brokers for the Purchase and Sale of the Public Stock, do hereby solemnly promise and pledge ourselves to each other, that we will not buy or sell from this day for any person whatsoever, any kind of Public Stock, at a less rate than one quarter percent Commission on the Specie value and that we will give preference to each other in our Negotiations. In Testimony whereof we have set our hands this 17th day of May at New York, 1792.

Twenty-five years later on March 8, 1817, the group officially became the New York Stock &

Exchange Board, later simplified to the New York Stock Exchange. Throughout the early 1800s, the NYSE expanded beyond government bonds and bank stocks. New York itself soon surpassed Philadelphia as the financial center of the United States.

Trading on the NYSE floor was revolutionized by the telegraph

Advances in telegraphic communication allowed buying and selling through the telegraph. Membership increased and became more exclusive. By the start of the Civil War, securities, commodities and gold, discovered in California, excited participation in the exchange. In 1878, telephones were installed, giving investors direct access to brokers on the floor of the exchange. The increased activity made the exchange cap the number of members to 1,060, requiring future members to purchase seats from retiring members.

After WWI, the market and the economy struggled. At least 60% of the country's population earned less than $2,000 a year, the basic minimum estimated required for a family to live on. It was this financial climate that left the market ripe for disaster. On Thursday, October 24, 1929, a record 12,894,650 shares changed hands. The huge volume left the ticker tape, a fairly new invention, unable to keep up. The beginnings of a panic rumbled through the exchange. A break for lunch, of all things, saved the day, allowing trading to close with some regain of the losses. Trading continued to slow down on Friday, and the weekend was a welcome relief. 

Yet as history books reveal, Monday's trading was once again huge: over 9,250,000 shares. The losses were great. But unlike Thursday's salvation, there was no recovery. It was the prelude to Black Tuesday, the most infamous day in Wall Street's history. 

 Over 16,400,000 shares were traded on that Tuesday in 1929. People dumped their securities and caused even more downward pressure on the market. Stockbrokers were in tears, hopelessly trying to get in touch with customers. The panic of selling prevented any recovery. The Dow Jones closed at $230 -- down 23%. The market had crashed. 

From October 29, 1929, to November 13, 1929, $30 billion simply vanished from the United States economy due to falling stock prices.

Panicked New Yorkers flood Wall Street on October 29, 1929

The years between 1929 and 1942 are known as the Great Depression. During this time the unemployment rate in the United States hit a staggering 24%. Thousands upon thousands of people were without jobs, without homes, without food. Oddly enough, it was war that brought the depression to an end.

Admittedly, I've never really paid much attention to the stock market, but history makes it very clear we should. Do you dabble in the stock market?

Michelle Shocklee is the award-winning author of The Planter's Daughter and The Widow of Rose Hill. Her historical novella set in the New Mexico Territory is included in The Mail-Order Brides Collection. Michelle and her husband of 31 years make their home in Tennessee. Connect with her at www.MichelleShocklee.com.

THE WIDOW OF ROSE HILL

Widowed during the war, Natalie Ellis finds herself solely responsible for Rose Hill plantation. When Union troops arrive with a proclamation freeing the slaves, all seems lost. How can she run the plantation without slaves? In order to save her son’s inheritance she strikes a deal with the arrogant, albeit handsome, Colonel Maish. In exchange for use of her family’s property, the army will provide workers to bring in her cotton crop. But as her admiration for the colonel grows, a shocking secret is uncovered. Can she trust him with her heart and her young, fatherless son?

https://www.amazon.com/Michelle-Shocklee/e/B01MYD4TRE/ref=sr_ntt_srch_lnk_1?qid=1486004955&sr=8-1

Federal Writers' Project--Part of FDR's New Deal

Franklin D. Roosevelt

I’m sure we’ve all heard of the Stock Market crash that occurred on September 24, 1929, when the market lost eleven percent of its value in a single day. Most of us know that this was a contributing factor to the decade-long Great Depression, when countries all around the world saw enormous economic decline. In the United States alone, the unemployment rate soared to twenty-five percent during this period. And plenty of us heard about Franklin D. Roosevelt’s “New Deal,” a series of government programs put in place in the 1930’s in order to get Americans back to work through the “3 R’s” of Relief, Recovery, and Reform.

I remember learning all of these things in my middle and high school history classes, but they were all just static facts of American history to me until this past December. That’s when my husband and I received a phone call that brought this era of history to life for me. We’d arrived home from a nice dinner out to find a message from my husband’s long-lost step-sister. Her mother had passed away the month before, and in going through her mom’s effects, she’d found a box of my husband’s father’s things which she wanted to return to us.

Carl Uhlarik

When the box arrived, we were thrilled to find black and white photos of my husband’s parents and grandparents, old watches, birth and baptism certificates, diplomas, and other interesting memorabilia. But of most interest to me were a set of hand-written notes on notebook paper, as well as an old journal—all which had belonged to Carl Uhlarik, my husband’s grandfather. As we read over Carl’s neat script, we found the loose-leaf pages to be a journal of his efforts to write and publish a novel. The journal, dated February 10, 1939, was an odd assortment of sentences, phrases, and short paragraphs detailing story ideas he’d written down to remember for future writing endeavors. These items began to bring the man I’d never met to life, and it made me quite curious to know more about him. Thankfully, my husband remembered the basics…and despite the fact that Carl lived long before its invention, the internet helped me research other aspects of his life. The most interesting detail I found was that he worked for the Nebraska branch of the Federal Writers’ Project, one of the many arms of FDR’s New Deal program.

The Federal Writers’ Project was created in 1935 to provide employment for librarians, teachers, historians, writers, and other white-collar workers who were otherwise unfit for manual labor jobs. Instead, these folks were tasked with writing guide books about the peoples, geography, history, resources, traditions, and achievements of their respective states. All 48 states at that time had a guide book, as well as Washington D.C. and Puerto Rico. The American Guide Series is still considered to be one of the most comprehensive surveys of the American cultural geography ever written.

FWP authors at work in their Lincoln, Nebraska office.

Over time, the job expanded to more than just the guide books for each state. These historians went on to write the oral traditions, folklore, interesting tidbits, and historical facts for their states. Today, the Library of Congress contains over 300,000 pieces written by the authors of the Federal Writers’ Project, all filed under the American Memory Collection.

Some of the staff of Nebraska's Federal Writers Project team. We aren't sure, but
believe the man standing left of the two posters in the right corner may be Carl Uhlarik.

I can’t say what happened to all of the men and women who worked with the Federal Writers’ Project in the late 1930’s, but for Carl Uhlarik, his stint with the FWP set him on the path of writing throughout the rest of his life. He went on to work long-term jobs in radio and newspaper news, as well as doing freelance articles for various magazines. Among those are various western history magazines such as The West Magazine and Real West Magazine. It was pretty exciting to search the internet and find digital copies of a few of his articles published in the 1930’s, 1940’s, and 1950’s. I was also able to find and a few magazines on Ebay with his articles inside. What a thrill to read his words all these years later. It made him come alive in a way I never expected to experience, and he made The New Deal come alive in my brain in a way that it never had before.

It’s your turn: Have you explored your family tree and discovered any interesting characters? Who are they? Did discovering your ancestors make history come alive for you in a new way?

Jennifer Uhlarik discovered the western genre as a pre-teen, when she swiped the only “horse” book she found on her older brother’s bookshelf. A new love was born. Across the next ten years, she devoured Louis L’Amour westerns and fell in love with the genre. In college at the University of Tampa, she began penning her own story of the Old West. Armed with a B.A. in writing, she has won five writing competitions and finaled in two other competitions. In addition to writing, she has held jobs as a private business owner, a schoolteacher, a marketing director, and her favorite—a full-time homemaker. Jennifer is active in American Christian Fiction Writers and lifetime member of the Florida Writers Association. She lives near Tampa, Florida, with her husband, teenaged son, and four fur children.

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