Investing circa 1843

What ‘Panic’ Meant to Investors 143 Years Ago


You can see how an earlier era of investors thought of the term in this engraving, by the illustrator Frank Bellew for the cover of the Sept. 29, 1873, edition of The Daily Graphic, titled “Panic, as a Health Officer, Sweeping the Garbage Out of Wall Street.”

“Panic” appears to be dressed in rags, but in fact Mr. Bellew has portrayed him wearing breeches and a jerkin, or rough shirt, made of goat skin — an obvious reference to the Greek god. (This sculpture, from the 1st century A.D., shows how common that imagery was.) The garbage that Panic is sweeping out of Wall Street consists mainly of strips of ticker tape bearing such descriptions as “ROTTEN RAILWAYS,” “SHAKY BANKS” and “BOGUS BROKERS.” A few squawking ducks, one hobbling to the left between Panic’s feet, are trying to escape the wreckage — symbolizing the old Wall Street term “lame ducks,” or traders who bought stock with borrowed money they can no longer afford to pay back.

... In his unforgettable image, Mr. Bellew compares bad investments, and weak investors, to sources of disease. By spreading the fear that flushes out such “garbage” in the short term, panic ends up improving the hygiene of the market in the long term. That’s good for investors who have the staying power to outlast a panic — and bad for those who don’t.
Comment: Staying power ... a lesson from 1843. Image source.

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