LESSONS IN CRISIS MISMANAGEMENT FROM THE 1929 CRASH

Crisis management theory illuminates the New York Stock Exchanges efforts to recover organizational legitimacy after the 1929 crash and the scandals unearthed in its wake. Ineptly defusing charges of an unfair and disorderly marketplace, NYSE President Richard Whitney and his Old Guard colleagues magnified perceptions of Exchange dysfunction. Even after New Deal reform of the securities sector the NYSE remained a self-regulatory organization. How did the NYSE emerge from its crisis decade (1929—38) intact despite serious tactical mistakes by Exchange leaders?