Could one man's secret gamble really bring down the entire financial system? Andrew Ross Sorkin's "1929" plunges us into the heart of the most devastating market crash in Wall Street history, revealing the hidden anxieties and precarious decisions that led to a nation's shattering. This isn't just a history lesson; it's a chilling reminder of how easily confidence can crumble and fortunes can vanish. Let's take a peek inside...
Note: CBS News may receive an affiliate commission if you purchase the book through the links provided.
This excerpt from "1929: Inside the Greatest Crash in Wall Street History - and How It Shattered a Nation" (available at Penguin Random House) paints a vivid picture of Charles Mitchell, the head of National City Bank, on a day when everything started to unravel. You can also find the book on Amazon and if you are an audiobook lover, you can start a free 30-day trial at Audible.
Excerpt from "1929" by Andrew Ross Sorkin:
Charles Mitchell, a man accustomed to projecting unwavering assurance, ascended the steps of 55 Wall Street. The afternoon had been brutal. As he returned to his office, he was acutely aware of the scrutiny of Wall Street. From the street-level traders to his own secretary, every eye was analyzing his demeanor, searching for clues in his every gesture, every line on his face.
Dressed in a gray three-piece suit, shoulders squared, Mitchell maintained his signature smile as he walked through the glass-domed hall of National City Bank. The bank, with its towering eighty-three-foot ceiling and massive bronze doors guarding a vault weighing three hundred tons, was the largest in the United States. Think of it as the financial equivalent of a fortress, designed to inspire confidence.
The time was just after 5:30 p.m. on Monday, October 28, 1929. Earlier that day, the stock market had plummeted a staggering 13% – the most significant single-day drop in a week filled with agonizing declines. The streets of downtown pulsed with nervous energy. Brokers in fedoras, messenger boys, switchboard operators—all buzzing with speculation about the market's collapse. What sparked this meltdown? How much further could it fall? Would the markets even open tomorrow? The uncertainty was palpable.
As Mitchell walked toward his office, the teller windows reflected his weary eyes and disheveled gray eyebrows. He sank into the chair behind his mahogany desk. The room's decor was reminiscent of an eighteenth-century statesman's study: antique wood chairs and a grandfather clock stood against the cream-white woodwork, flanked by portraits of George Washington. Mitchell sought to embody the same purpose and resolve that Washington displayed in orchestrating the newly independent nation.
The athletic, fifty-two-year-old bank chairman, known as "Sunshine Charlie" for his relentless optimism, had spent the afternoon in emergency meetings at the Federal Reserve Bank of New York. The goal: to find a way to calm the markets. It was a moment that Mitchell, a self-proclaimed "Great Man," should have been prepared for. He possessed the experience, the stature, and the steely nerves to guide Wall Street through this crisis. Or so it seemed.
Yet, beneath the surface, he felt vulnerable and exposed.
He didn't have time to dwell on his emotions. Duty called.
Mitchell went upstairs to confer with Hugh Baker, who managed National City's stock-trading unit.
Baker, a tall, bald man with piercing eyes, calmly explained what had transpired while Mitchell was at the Federal Reserve. His tone was measured, but the implications were enormous.
"Our portfolio today has been tremendously increased in our holdings of National City Bank stock," Baker stated.
Mitchell stared at him, waiting for a clearer explanation. What exactly did that mean?
Baker finally blurted out: "We purchased seventy-odd thousand shares."
Mitchell, with his lightning-fast mental calculations, immediately grasped the gravity of the situation. That is unbelievable, he thought. The bank simply didn't have the liquid assets to cover such a massive purchase. Outrage mixed with terror. Everything he had worked for was suddenly at risk of collapsing.
Just a month prior, Mitchell had been riding high. He had finalized the acquisition of Corn Exchange Bank, a daring move that would transform National City from the largest bank in the country to the largest in the world, surpassing London and solidifying New York's dominance as the global financial center. This was history in the making, a disruption of the established order. This was the type of power move that elevated Mitchell to the status of financial royalty.
But to secure the deal, Mitchell had made a significant – and risky – wager on the strength of National City's stock. Corn Exchange shareholders had the option of taking $360 in cash for each of their shares or receiving four-fifths of a share in National City Bank. On paper, the stock option seemed more lucrative. As long as National City's stock price remained above $450, four-fifths of a share would be worth more than $360 in cash. At the time of the agreement, the stock was comfortably trading at $496 per share. Mitchell needed it to stay at that level until the deal closed, likely within the coming month. And this is the part most people miss: National City didn't actually have the cash reserves to pay everyone in cash.
So, he discreetly instructed his traders to buy the bank's shares whenever the price dipped. But here's where it gets controversial...
In a stable market, this practice would have been routine. Publicly traded companies regularly buy back their own shares. However, in a rapidly declining market, it was akin to throwing money into a furnace. In the chaotic trading environment, National City's bids were accepted so rapidly that they lost track of the accumulating shares. By the time they regained control of the situation, National City had committed to purchasing seventy-one thousand of its own shares, far exceeding its financial capacity.
"With that news," he confided to Baker, "I could be knocked over with a feather."
His options were severely limited. Large banks like National City relied on borrowing against their assets to fund their daily operations. However, banking regulations prohibited them from using their own stock as collateral. Consequently, those seventy-one thousand shares – valued at approximately $32 million – became a liability, potentially jeopardizing the entire bank's stability.
"It would be embarrassing for us to attempt to borrow on that stock in other banks," Mitchell stated, fully aware that his competitors would interpret such a move as a sign of weakness. With the market spiraling downward, short sellers – traders who profited from declining stock prices – were actively seeking out vulnerable targets.
The stock market was on the brink of collapse. Trading volume had overwhelmed the exchange's infrastructure to such an extent that the ticker tape, on the previous Thursday, lagged behind real-time prices by four hours – more than double the previous record delay. Can you imagine trying to make informed decisions with data that's hours out of date?
This meant that the large board displaying stock prices on the New York Stock Exchange floor was hopelessly inaccurate. Trading stocks in this environment was like gambling at a baseball game in the eighth inning while consulting a scoreboard that hadn't been updated since the third, amidst conflicting opinions about which team was ahead and by how much. Prices for stocks traded privately – "off-exchange," as was the case with National City shares – were even further delayed because they were tied to the broader market's movements without real-time updates. For Wall Street traders, the only sensible course of action was to sell and exit the market as quickly as possible. Which is precisely what they were doing.
Mitchell understood that if he attempted to sell even a small portion of National City's shares back into such a weak market, rumors about the bank's solvency would spread rapidly, potentially triggering a self-fulfilling prophecy that would be impossible to stop. If prices declined rapidly enough, it could spark a far greater crisis: "A lack of confidence might bring a run," Mitchell told Baker, envisioning depositors lining up outside each of the bank's fifty-eight branches across the country.
A run on the nation's largest bank. That was the ultimate nightmare for any banker.
From "1929," published by Viking, an imprint of Penguin Publishing Group, a division of Penguin Random House, LLC. Copyright © 2025 by Andrew Ross Sorkin.
Get the book here:
- "1929" by Andrew Ross Sorkin (Amazon)
- Buy locally from Bookshop.org
For more information:
- "1929: Inside the Greatest Crash in Wall Street History - and How It Shattered a Nation" by Andrew Ross Sorkin (Viking), in Hardcover, Large Print Trade Paperback, eBook and Audio formats (Penguin Random House)
- Andrew Ross Sorkin (Bio Site) (Bio Site)
Now, let's open the floor for discussion: Do you think Mitchell's actions were justified, given the circumstances? Was he a visionary leader or a reckless gambler? And, perhaps more importantly, what lessons can we learn from 1929 to prevent a similar crisis from happening again? Share your thoughts in the comments below!
