So, how did we get here?
Hoover's crash was set up by the election of 1920, when Republican Warren Harding convinced Americans to abandon the trust-busting, high tax, progressive policies of Presidents Teddy Roosevelt, William Howard Taft, and Woodrow Wilson in favor of that generation's version of neoliberalism or what we today call Reaganomics.
Harding referred to it as "Horse and Sparrow Economics" "- it was the early 20th century version of what Reagan later reinvented as "trickle-down economics."
If the horses (rich people and big business) were fed more oats (through deregulation and tax cuts), more of those oats would pass undigested into the horse manure that then littered the streets of American. The sparrows (working class Americans) could then pick the extra oats out of the manure.
In 1920, Warren Harding won the presidency on a campaign of "more industry in government, less government in industry" "- privatize and deregulate "- and "a return to normality," his promise to drop the top tax bracket from its then-91 percent rate down to 25 percent.
Harding kept both promises, putting the nation into a sugar-high spin called the Roaring '20s, where the rich got fabulously rich and working-class people were being beaten and murdered by industrialists when they tried to unionize. Harding, Coolidge, and Hoover (the three Republican presidents from 1920 to 1932) all cheered on the assaults, using phrases like "the right to work" to describe a union-free nation.
FDR's response to Hoover's Depression was to raise the top income tax bracket back up to 91% and impose stiff regulations on banks and Wall Street, creating the Securities and Exchange Commission (SEC) and putting Joe Kennedy in charge of it.
Gloria Swanson, who knew Kennedy well and intensely disliked him (he'd robbed and exploited her), told me over one of our many dinners in her New York apartment that FDR knew, "It takes a crook to catch a crook." And FDR was going after the crooks.
High taxes on the morbidly rich and aggressive government enforcement of banking and securities rules prevented another large-scale crash for a half century until Reagan came along and repeated Harding's mistakes in the 1980s.
When Reagan deregulated the Savings & Loan industry the banksters stole so much money they crashed S&Ls across America, the first serious bank panic since the Republican Great Depression.
Now, if Dimon is right, hang onto your hat for another "event."
The core tenant of both Harding's and Reagan's versions of neoliberalism is that the economy is essentially a force of nature. It's why Harding did away with regulations on stock speculation and why Reagan deregulated everything he could as fast as he could.
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