Commercial morality is enormously improved. The man who handles it is assumed to be dishonest until he proves himself otherwise. Money is watched with a narrow, suspicious eye.

Under these circumstances the rate of embezzlement grows, the rate of discovery falls off, and the bezzle increases rapidly. Arguing that the 1929 stock market crash was precipitated by rampant speculation in the stock market, Galbraith notes that the common denominator of all speculative episodes is the belief of participants that they can become rich without work. But even though money is plentiful, there are always many people who need more. John Kenneth Galbraiths classic examination of the 1929 financial collapse. In good times people are relaxed, trusting, and money is plentiful. It also varies in size with the business cycle. This inventory-it should perhaps be called the bezzle-amounts at any moment to many millions of dollars. There is a net increase in psychic wealth.) At any given time there exists an inventory of undiscovered embezzlement in-or more precisely not in-the country’s businesses and banks. (This is a period, incidentally, when the embezzler has his gain and the man who has been embezzled, oddly enough, feels no loss. Weeks, months, or years may elapse between the commission of the crime and its discovery. Alone among the various forms of larceny it has a time parameter. To the economist embezzlement is the most interesting of crimes. In many ways the effect of the crash on embezzlement was more significant than on suicide.

Galbraith the great crash