John King, a history professor at the University of Houston, believes the 1929 analogy doesn't bear much merit. "Personally, I don't see many current parallels to the period of the crash," he said. "The situation is entirely different. Although there are problems with the stock market values, there are also a number of government safeguards not in place in the late '20's."
"Of course, anything can happen," he adds, hedging. "I don't mean to weasel out of taking a firm line, but, as a historian, I have to."
The other day, like children peering at pastries in a bakery, stock market enthusiasts pressed against the glass windows of Merrill Lynch's investment information center in Grand Central Station, reading the price of leading securities and the Dow Jones industrial average on a large television screen. Occasionally, homeless men and women carrying their belongings in shoppings bags, stopped to watch the fledgling capitalists.
"I'd like to buy IBM," one man announced. "I think it's had its own correction."
"The best thing for the market is President Reagan," another amateur stock analyst asserted.
"I buy options. I come over once a week," said an accountant carrying a briefcase, who declined to give his name. "I've done well. I bought a car, a Nissan Maxima."
From the back of the crowd, someone ventured an opinion about oil stocks, hard pressed because of the precipitous drop in crude oil prices. "I've got Mobil. I'm thinking of Phillips Petroleum," he said. "I want to increase my holdings of Mobil. Phillips is dirt cheap."
The tantalizing specter of profits, of life's better things, of security for the future, floated through the conversations, while other New Yorkers scurried for trains and the homeless looked on.
Watching Paper Profits
"It is a little nutty," said Cohen, who moved from New York to become chief executive officer of Lowe Marschalk advertising in San Francisco. "When gold went up to $800, I saw all these people leaping out of cars and running into Deak-Perera with trays and silverware and gold. This is scary also. You are watching the stock market make 30-point moves. You're watching this thing and instinctively you sort of know this can't continue. You are going to wake up one morning, and, you should pardon the expression, there will be a 'correction,' and the paper profits will have gone away."
But Cohen paused for a moment, and his conversation turned suddenly bullish. "It will be interesting to see what happens when the Dow reaches 2,000. That psychological barrier--2,000--we could pass that like a fast freight and look at 3,000. I don't know how far down the price of oil will go. They are selling leaded gas for 76 cents a gallon. If you add that to the equation--Whoopie!"
Also contributing to this story were Times staff writers David Treadwell in Atlanta, Michael Wines and Sara Fritz in Washington and researchers Wendy Leopold in Chicago and Joanne Harrison in Houston.