Bankers and brokers on LaSalle Street thought the town's hoodlums were shooting their way into brokerage offices and promptly called police. The noise reverberating in the canyon of office towers turned out to be a boy's firecracker. All the police found were law-abiding citizens with nerves rubbed raw by the October stock market crash. No one living through the market break, which began in earnest a week earlier and reached its biggest one-day loss on this date, realized what was happening. The market had peaked in early September and days of wild selling often were followed by equally frenzied "bargain-hunting" rallies.
Chicago, a town built--and rebuilt--on speculation, was neither deterred by speculative excess nor cowed by speculative losses. For weeks before the crash, investors who on one day jammed brokerage offices to sell, crowded in the next day to buy. The Railroad Shares Corp., a sort of mutual fund for railroad stocks traded on the Chicago Stock Exchange, advertised on Oct. 31 that the crash presented "the best opportunities for Chicago people to lay the foundation for fortunes since they bought real estate from the Indians."The Tribune headline of Oct. 30 read, "Stock Slump Ends in Rally." The next day, the paper declared "Market Scare Over." But the market slump was not. Share prices slid through mid-November. Prices rebounded in early 1930, but the rout resumed. When it ended in 1932, stocks had fallen by 85 percent. During the October shocks, utilities magnate Samuel Insull and Julius Rosenwald, chairman of Sears, Roebuck and Co., helped employees meet brokers' demands for payment for stocks bought on margin.
By the fall of 1929, the Farm Belt was already in a depression; the market break signaled that the downturn was spreading to the cities. Nationally, unemployment reached 25 percent. More than 160 banks in the Chicago area failed, and for the first half of 1931 alone, nearly 1,400 families were evicted. Jobless men slept along lower Wacker Drive and renamed it the Hoover Hotel in honor of the country's president.
A new form of political spoils, handed out by corrupt judges, were receiverships awarded to oversee--which meant "loot"--bankrupt real estate. Al Capone sponsored soup lines. Chicago's boom times--for the 1920s had roared not just in the speak-easies and stock markets but also in real estate and industry--had come to an abrupt end. For the next dozen years, the Depression would be the grim backdrop of life.