1929

Tomorrow we’ll know if the US election was pivotal or not. Today it feels so. The Trumpian years may come to an abrupt final chapter in the next 24 hours. Or, maybe not. Perhaps President Vance would be worse – and on his way. Yikes.

Anyway, some people worry a lot about financial markets, their portfolios and what this past decade has done to the meaning of risk. Lately it’s given rise to a mess of sketchy, alarmist, often cringy YouTube vids and Substack blatherings about how 2026 = 1929.

Unless you are at least 120 years old (may we have a show of hands?) what happened back then is only academic. We know the stock market went into a dive, helped precipitate the Depression and lost 90% of its value, then took 25 years to recover. (However, because of massive deflation, real values restored in about seven years.)

We also know when the record stock bubble burst in 1929 the US economy went into a tailspin made infinitely worse by Washington’s policy of stiff tariffs, protectionism and isolation.

Sound familiar? The YouTubers think so.

If you like to worry, there are more valid comparisons.

Today the S&P 500 is at a record level. In fact, so far in 2026 alone that index has hit 30 new all-time highs. The Dow has scored 25 historic highs. And on Bay Street the TSX has been pushed into the record books 35 times in just the last ten months.

This has happened despite the Iran war, a global trade and supply-chain mess, the escalating Ukraine-Russia conflict, surging energy prices, the return of inflation, a sharp rupture in the world political alignment and a completely unpredictable and untrustworthy American president.

Are investors blind to these things? Or don’t they matter? After all, as the world entered the 1930s it was also becoming polarized, unstable politically with a widespread rise in authoritarian governments. As now.

There’s more.

In 1929 investors were greedy to own stocks in the latest tech. Cars, radio and electrification were driving markets and the popular imagination as society adopted the new technologies into everyday life. RCA became the poster stock of the bull market. Yeah, it was the 1929 Nvidia or Meta. Today, as we know, AI investing and spending has accounted for most of the entire GDP growth of the States and equals about half the stock market. Artificial intelligence is everywhere, but the cost is immense as data centre construction in one year alone will take $1 trillion US. Much of that is debt.

As a hundred years ago, the question si the same; is this a bubble? Have investors gone too far? Was SpaceX a symbol of it? Or the coming blockbuster Anthropic IPO?

There’s more.

In 1929 a stock-owning mania grabbed the public. Famously, shoe-shine buys gave out investing tips. Households were buying stock in new, unproven ventures on margin (with loans) or through installment plans set up by brokerages. Today, it’s far worse. Over 58% of all Americans – about 160 miollion adults – have direct exposure to the stock market. The bulk of that is through pension plans and retirement accounts (401k), while one in five households have direct brokerage accounts. Never has the population been more invested in markets which have never been higher and in such a concentrated way.

And, of course, in 1929 they just had money, Today we have crypto. Even the president of the USA is a crypto speculator, promoter and billionaire. Last week the biggest crypto exchange, Binance, announced a hack that cost its clients almost $3 billion. Meanwhile with apps like Robinhood kiddos can flip shares in Alphabet or digital coins on their phones in seconds. Stocks can be paid for with debit. Crypto buys can be put on Visa or MasterCard.

Oh yeah, and margin debt in the states alone recently hit $1.5 trillion. That’s money borrowed to buy securities that could rise, or crash.

What could possibly go wrong?

Now you can see why there is a p-doom industry flourishing. It’s pretty easy to get people spooked when similarities are laid out.

But relax. It’s not 1929. Not even close.

Markets are highly regulated, structured and supported now. There are circuit-breakers to prevent steep slides. Central bank intervention can stabilize any scenario. Stock market regulators like the SEC in the US or Canada’s securities commissions to mitigate wild swings or excessive speculation.

More fundamentally, monetary policy is tightly controlled by coordinated central bank policy. Companies are seriously profitable, with earnings this year surging by more than 30%. The new tech – social media, chips, AI – is throwing off massive amounts of revenue. In fact the most valuable companies in the world are insanely profitable with products and services used daily by billions of people. Astonishingly, over half the humans alive have a smart phone.

The banking system is stable, especially in Canada where it is hugely profitable, highly regulated and immensely disciplined – as well as monolithic. In 1929 there were 30,000 local, unregulated US banks that collapsed, for example. Today the fed supports the handful that get into trouble, making depositors whole.

Substantial risks that remain? There are a few.

One may be done tomorrow.

About the picture: ‘This is Rio,” writes Patricia, “a rescue from South Korea who travelled across the earth to our daughter’s home in Vancouver seven years ago. When he first arrived, his hind legs shook at the sight of everything – another dog, body of water, bumpy trail, hair brush. Recently my husband and I dog-sat while our daughter and her family went  on a road trip through British Columbia and while Rio is still skittish (he has to be in the right mood to allow himself to be leashed) he trotted ahead of us, enjoying a new neighbourhood. In two weeks , we fell in love with Rio, who looks like a small deer but also resembles a wolf. Unlike most dogs, he loves vegetables and is not interested in food as a reward. He also seems befuddled by dogs that run into the sea and chase balls.”

To be in touch or send a picture of your beast, email to ‘[email protected]’.

Source: https://www.greaterfool.ca/2026/11/03/1929/