Though a narrow and select rally, the Dow Jones Index sneaked in an all time high this week on September 3, 1929 -- a dubious achievement that would endure for the next twenty-five years.

It was a blistering hot day after the Labor Day holiday and the trading session was active. Only a handful of stocks, however, were responsible for pushing the major index higher. Talk of a crash at this juncture was limited and probably only taken seriously by holders of stocks that had already seen significant pullbacks in prices since their peaks-including bellwether General Motors, already down 10%.

Two days later, a financier named Roger Babson issued a lunchtime warning at a genteel gathering in Wellesley, MA that was picked up by the wire services on 2:00 PM that day. His opinion (that he had for the past year) that "...a crash is coming, sooner or later" became known as the "Babson Break" that sent the market into a meaningful downward spiral.

By October 1929, the general mood on the Street was gloomy.

This Week in Wall Street History

8/31/08