The phrase describing the September 1929 market drop after Roger Babson’s warning was the “Babson Break.”
On September 5, 1929, Babson warned that a crash was coming and that it might be “terrific.” The market fell roughly 3% that day, and the subsequent September decline became known in the press as the Babson Break. It followed the Dow Jones Industrial Average’s September 3 peak of 381.17.
The Babson Break was an early warning tremor, not the main October collapse. By the end of September, the market had fallen about 10% from its peak, but many investors viewed the decline as a healthy correction and buying opportunity. Selling intensified in October, culminating in Black Thursday, Black Monday, and Black Tuesday.
A common mix-up is “Hatry Break”: Clarence Hatry’s fraud scandal affected confidence and coincided with the period, but it did not supply the established name for this September Wall Street decline.