The 1929 crash was the match, not the powder keg. This episode looks past Black Thursday and Black Tuesday to the conditions that turned a market drop into a decade of global misery. The Roaring Twenties ran on wealth inequality and stocks bought on margin, often with 10 percent down. The market briefly recovered in early 1930, then lost 85 percent of its value by 1932. The deeper wound was banking. In December 1930 a private New York lender with the unlucky name Bank of United States collapsed, panic spread, and by 1933 some 9,000 of the nation’s 25,000 banks had closed for good.

Policy then carried the damage abroad. The Smoot-Hawley Tariff Act of 1930 set off retaliation that cut global trade by more than 50 percent, while the gold standard forced central banks to shrink their money supplies and deepen deflation. When Vienna’s Creditanstalt failed in May 1931, capital fled central Europe, German unemployment neared 30 percent, and the Nazi party took power in 1933. At home, the story runs through Hoovervilles, the Dust Bowl, the New Deal, and the argument economists still have about what finally ended it.

• Countries that left the gold standard early, like the UK and the Scandinavian nations in 1931, recovered much faster than France and Belgium, which clung to it in the so-called Gold Bloc.
• In the United States, GDP shrank by 30 percent, unemployment reached 25 percent by 1933, and crop prices fell by up to 60 percent as the Dust Bowl drove hundreds of thousands from their farms.
• Mothers sewed children’s clothes from flour and feed sacks, and manufacturers responded by printing the sacks with floral patterns and bright colors.
• Treasury Secretary Andrew Mellon advised Hoover to liquidate labor, stocks, and farmers, a hands-off purge that wiped out healthy capital along with the bad.
• Keynesians argue the New Deal spent too little, while Milton Friedman and Anna Schwartz blame the Federal Reserve for letting the money supply collapse. Many historians credit the mobilization for World War II with ending the slump.