Regime Uncertainty and Market Uncertainty

Regime Uncertainty and Market Uncertainty

The Great Depression formally began in August 1929, two months before Black Tuesday. Initially, the economic downturn that began late that Summer gave no signs that it was the start of what was to become – and, so far, remain – the greatest economic calamity in United States history.  Just a decade earlier there occurred another severe downturn, described by Milton Friedman and Anna Schwartz as “one of the most rapid declines on record.” The 192…