Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.
What Happened: On May 27, 1933, U.S. President Franklin D. Roosevelt signed the Securities Act of 1933.
Where The Market Was: The Dow Jones Industrial Average traded at around 1,867, and the S&P 500 had not yet been created.
What Else Was Going On In The World? In 1933, U.S. Great Depression-era unemployment peaked at 25.2%. Adolph Hitler became chancellor of Germany. The average price of a new house was $5,750.
Securities Act of 1933: Many Americans had lost a huge amount of money during the stock market crash of 1929, and the Securities Act of 1933 was intended to help investors make more informed decisions when buying stocks.
The law required that all stock and bond issues publish a prospectus that included disclosures such as risks, conflicts of interest and ownership positions.
The goal of the legislation was to help reduce the amount of deceit, misrepresentation and fraud that was often associated with stock and bond sales at the time.
"The Act is thus intended to correct some of the evils which have been so glaringly revealed in the private exploitation of the public's money,” Roosevelt said of the bill.
The Securities Act of 1933 was so popular among all Americans that it passed the House of Representatives without any debate or recorded vote, and the Senate debated the bill for just two hours before passing it as well.
