Tuesday, April 28th, 1942

A black-and-white photograph of a small town square at dusk in April 1942, after a war-bond rally has ended. A low wooden platform stands empty, its bunting sagging, folding chairs knocked askew, papers on the ground. On the platform's edge sits a gaunt old clown, his pale makeup cracked and failing at the jaw, smudged crescents drooping under his eyes, a tarnished nose, a filthy torn ruff over a patched coat — elbows on knees, looking at the ground between his shoes. Across the square, at the far edge of the frame under the first lit streetlamp, a woman is arriving: her face is split down the center, one half pale and one half dark, in a pleated two-tone ruff, mid-step toward the platform. He has not seen her yet. The light in the square is the last of the day's; hers is the first of the night's.

The seller who quit one day too late

DOW JONES 92.92 · −0.97 · −1.03% · the low of the whole war

There was no crash at the bottom of the war. There was a Tuesday in April with the tape nearly dead, Bataan three weeks fallen, Corregidor about to go, a price freeze issued that morning pinning everything to its March high, and a fireside chat scheduled for the evening about sacrifice. Into that exact news the Dow drifted down one more percent, to 92.92 — the lowest close since 1934, off 52.2 percent from the 1937 top, close to close. Wednesday it rose, unheralded. It never traded below this day again. Somewhere a seller got out at the bottom of the entire war, one day too late to change his mind.

The photograph Pennyless at the Bond Rally

The day's protagonist

The exhausted seller — no symbol.

Move: −1.03% — the last percent of a five-year bear

The bottom of the entire Second World War was a drift, not a crash: down 97 cents on a dead tape, to 92.92 — the lowest close of the 1937–42 decline and the lowest since 1934, off 52.2 percent close-to-close from the March 1937 top. The war news could not have been worse: Bataan had fallen on April 9, the Doolittle raid on the 18th had been a gesture and read as one, Corregidor had days left. And Washington chose this exact Tuesday to close the vise — the General Maximum Price Regulation issued that morning, freezing prices at their March highs, with the President's fireside chat on sacrifice scheduled for the evening, after the close. Profits looked ceilinged, taxes uncapped, the Pacific lost. Whoever sold the last lot into that afternoon quit a five-year bear one day before it ended. Wednesday rose 1.86 percent, unheralded; the Coral Sea checked Japan within the week; Midway turned the war in June. The Dow never traded below 92.92 again — not in the war, not in the century, not ever.

The deeper account

The Chronicle wrote that week that the markets were making new lows every other day — the sentence of a paper that had stopped expecting anything else. That is what a bottom sounds like: not a bell, a shrug.

This page settles two promissory notes. The Fall of France page of May 1940 ends its almanac with "the bottom to come: April 1942." The Pearl Harbor page one step back ends the same way. Here it is — twenty percent below Pearl Harbor's eve, forty below the war babies' peak, fifty-two below 1937.

In the photograph of this day the rally is over and the square is empty, and the old clown sits on the platform edge at the end of the selling. He does not see the figure arriving under the streetlamp across the square. Turns arrive like that — from the far edge of the frame, at dusk, while the exhausted are looking at the ground.

The ground is the blue-dark of a dimmed-out spring evening; the pigment is ration ink — the blue-black of the stamps that pinned every price in the country except this one, which found its floor by itself.

The artifact

OFFICE OF PRICE ADMINISTRATION · APRIL 28, 1942 MAXIMUM PRICE no article may be sold above its highest March 1942 price. CEILING bread — pinned. coffee — pinned. shoes — pinned. the industrials — not pinned. 93.89 → 92.92 · down 1.03 percent. the lowest close since 1934. fifty-two percent below 1937. it never traded lower again. SHOPKEEPER'S HAND they froze every price in the country today except the one that stopped falling on its own. EFFECTIVE MAY 11. THE BOTTOM WAS EFFECTIVE IMMEDIATELY.
The ceiling card — a shopkeeper's General Max card, filled in on the day it was issued

On the day the market found the war's floor, Washington froze every other price in the country: the General Maximum Price Regulation — "General Max" — issued April 28, pinning everything to its highest March price, effective mid-May. The shopkeeper's card does the day's accounting: bread pinned, coffee pinned, shoes pinned — and the industrials not pinned, drifting down one last percent to 92.92 on a dead tape, the lowest close since 1934. The evening brought a fireside chat about sacrifice, after the close. Wednesday morning the turn came, unheralded, and the Dow never traded below this day's number again. The one price nobody could freeze found its own floor.

Read the card

Printed text is shown plain; the handwritten entries are shown in script.

OFFICE OF PRICE ADMINISTRATION · APRIL 28, 1942 — MAXIMUM PRICE [stamped: CEILING] — no article may be sold above its highest March 1942 price.

  • bread — pinned. coffee — pinned. shoes — pinned.
  • the industrials — not pinned. 93.89 → 92.92 · down 1.03 percent. the lowest close since 1934. fifty-two percent below 1937. it never traded lower again.
  • SHOPKEEPER'S HAND: they froze every price in the country today except the one that stopped falling on its own.
  • EFFECTIVE MAY 11. THE BOTTOM WAS EFFECTIVE IMMEDIATELY.

On Tuesday, April 28, 1942, the Dow closed at 92.92, down 1.03 percent — the closing low of the 1937–42 bear, 52.2 percent below the March 1937 top close-to-close, and the bottom of the entire Second World War. The General Maximum Price Regulation was issued the same day; the fireside chat on sacrifice came that evening, after the close. The next session rose 1.86 percent; Midway turned the war in June; the Dow never traded below 92.92 again.

The ledger — what actually happened

Measure Close Change Marginalia
Dow Jones 92.92 −0.97 · −1.03% the lowest close of the 1937–42 bear and the lowest since 1934; never traded below again; per the daily record
The drawdown −52.2% from 1937 close-to-close from the March 10, 1937 top of 194.40; from the war babies' September 1939 peak, −40.4%
S&P composite 7.47 the 90-stock daily composite's matching low — per the official back-history and the standard bear-market tables
The ceiling issued this day the General Maximum Price Regulation — "General Max" — every price pinned to its March high, effective mid-May
The turn +1.86% next day unheralded; Coral Sea within the week, Midway in June. The recovery ran, by the standard count, +158% to May 1946

Sources

  1. MeasuringWorth — Daily Closing Values of the Dow Jones Average (every close, April 20 – May 5, 1942, plus the 1937 peak and the 1935/1938 reference lows) — https://www.measuringworth.com/datasets/DJA/
  2. Commercial & Financial Chronicle, April 30, 1942 (via FRASER) — "the markets are making new lows every other day"
  3. National Archives (RG 188) — the General Maximum Price Regulation, issued April 28, 1942; effective May 11/18
  4. Yardeni / First Trust bear-market tables — the composite's 7.47 low and the +158% recovery to May 1946
  5. FDR fireside chat No. 21, "On Our National Economic Policy and Sacrifice" — the evening of April 28, 1942