Another thrill packed week in October history - this one from the 15th in 1979, via the CBS News program The World This Week. Wall Street took a dive, the interest rates took a hike and the housing market took a powder.
John Bohanon (CBS News): “It all started last week – the Federal Reserve Board raises the Interest rate, the rate banks are charged for borrowing from the Fed. An increase of one full point to 12 percent. Something has to be done, says the Fed, to stop inflation and curb speculation. On Monday; the first reaction. The Dow Jones Industrials went down over thirteen and a half points. Tuesday: Another shock; several banks raise their prime rate, the rates the banks charge their best corporate customers. The Prime up one full point to fourteen and a half percent; an unprecedented increase. Down goes the Dow again, another twenty-six and a half points. Bond prices plunge. And on Wednesday, history is made on Wall Street. A record trading day, almost 82 million shares changing hands. At one point, the market down nearly 25 points for the day.
The rest of the week was taken up with Fidel Castro's visit to the UN and his very vocal support for the PLO, the 1980 campaign trail, the Ted Kennedy factor and fears of a major recession washing up on our financial shores.
Just another week - same as it always is.