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On Monday morning, the Dow Jones industrial average plummeted 1,000 points; last week marked the worst for the stock market in about four years. In this flashback to October 2009, Harry "The Hat" Kollatz Jr. reflects on how Richmond fared during one of the worst financial market periods in history, the Great Depression.
On Oct. 28, 1929, around 9 p.m., a roof section from the Southern Railway depot on 14th Street rocketed off and damaged the overhead Chesapeake & Ohio railroad trestle. The explosion scrambled 10 seamen from the nearby U.S.S. Eagle Patrol Boat #35. One sailor was injured, while debris and sparks from at least seven other minor blasts pelted arriving firefighters.
The depot’s steel doors glowed red, and the flames consumed 10 freight cars. Fire officials blamed a spark from a locomotive’s engine igniting barrels of oil.
The next morning’s Richmond Times-Dispatch reported the story on the far left column but also noted, in a separate story just above the fold: “Wall Street Again Suffers Acute Slump.” The evening News Leader declared: PANICKY SELLING BRINGS NEW BREAK IN STOCK.
Stock prices, ballooned by speculation, had created unsustainable prosperity. The financial market had revved so high and then, in a series of sputters beginning Oct. 24, experienced engine trouble until exploding, just like the Southern Railway depot. The Roaring ’20s were over. The market’s collapse was among the first of many events that would usher in the Great Depression.
Other Richmond news of Tuesday, Oct. 29, included a scandal about an anonymous pamphlet suggesting that Republicans wanted to repeal the poll tax preventing blacks from voting. Democratic gubernatorial candidate John Garland Pollard refuted any connection to the circular.
Downtown Broad Street prepared for a Halloween celebration with costume contests for children including the categories of best flapper, “colored minstrel, mammy, Charlie Chaplin, Indian and clown.”
In the week of the market crash, a timely news item seemed to offer a harbinger of worse times ahead: More than 40,000 people visited the William Byrd Community House in 1929 seeking help from the social-services organization, based in white, working-class Oregon Hill.
The morning after the crash, the Richmond Times-Dispatch collected perspectives from leading businesspeople. William H. Schwarzschild, president of the Central National Bank, stated, “There are many men and women who are practically wiped out. We have tried to warn the people who have been speculating for two years but to no avail.”
As the nation’s economy was on the way down, however, notable Richmond brands were on the way up. Weeks prior to the crash, the soaring, 22-story Art Deco CNB building opened at Third and Grace streets.
Wednesday after the crash, the Hotel John Marshall opened with fanfare at Fifth and Franklin streets. Cash registers rang for the first time in “The Greater Thalhimer’s Store” (site of today’s Richmond CenterStage) on Oct. 2. An unintentionally prescient Thalhimer’s ad in the News Leader’s crash issue displayed women’s “Apparel that looks expensive — but isn’t.”
Signs of imminent financial trouble were evident in 1928’s year-end figures at Maggie Walker’s St. Luke Bank & Trust. The city’s black banks and insurance firms were undercapitalized, and white thrifts sought dominance. Walker’s bank merged with the Second Street Savings and Richmond Beneficial in December to form Consolidated Bank and Trust Company, with Walker serving as chairman of the board. (In the fall of 2009, Premier Financial Bankcorp of Huntington, W.Va., was considering purchase of Consolidated.)
The Richmond Planet, an influential African-Amer-ican news weekly from the 1890s to 1910s, made no notice of the crash. The Planet’s haphazard content mirrored the decline of its editor and publisher, “The Mighty” John Mitchell Jr. Mitchell’s career was bracketed by his courageous stands against oppressive racism and the 1922 closing of his Mechanics’ Savings Bank coupled with felony indictments, which led to a short, humiliating jail stint. The Virginia Supreme Court of Appeals cleared his name in 1925.
On Thanksgiving Day 1929, the 66-year-old Mitchell walked to the office despite suffering from a kidney ailment that swelled his feet and legs. He collapsed at the Planet and was carried home, to 515 N. Third St. Mitchell died around daybreak on Dec. 3. The Dec. 7 Planet headline proclaimed, “Race Chieftain Sheds Armor.”
The slow-moving Depression here was initially met by denial. Valentine Richmond History Center historian Edward D. Ragan, curating a Depression-era exhibition opening on the 80th anniversary of the crash, explains how the state and city government urged retrenchment, not relief. “It was the ‘Virginia Way’: Avoid budget deficits, don’t borrow any money, maintain a stoic attitude. And it sort of worked, for a while.”
A postcard sent to customers by American Bank & Trust reproduced a bleak image of 10th and Main streets following the devastating 1865 Evacuation Fire. The caption: “If you think times are tough now,” and on the reverse, “Virginia’s future was never brighter.”
In 1932, 9,000 of Richmond’s 183,000 residents were unemployed, but by 1935, 17,598 citizens were on the dole. More asked for assistance than received it. “Many got turned down, especially minorities,” Ragan says.
Richmond’s vaunted diversified economy held off the worst effects; unemployment here was half the national mid-Depression average of 24 percent. A chamber of commerce report indicated that between 1929 and 1937, Richmond’s industrial output actually increased 44 percent.
After Franklin Roosevelt’s 1933 “Bank Holiday,” only one Richmond institution failed to reopen: American Bank & Trust.
