Why do researchers turn to unstructured financial text to better understand stock market behavior? How can stock market news reports help to reveal novel events and associated narratives while allowing for unanticipated change and true uncertainty? Chapter 4 discusses the particular features of textual analysis that are attractive to researchers investigating these questions. The benefits of soft information, broader and richer information sets, textual tone, unstructured data, and novel event identification are all discussed within a narratological framework. Focus will be paid to the textual data sources of stock market news reports released by Dow Jones, The Wall Street Journal, Barron's, MarketWatch, and Bloomberg News. Word clouds from Bloomberg News stock market wrap reports based on a lexicon dictionary of unique entities and nonrepetitive events for the last twenty-seven years are presented with accompanying histograms of event frequency. The chapter motivates the benefits from employing the RavenPack news analytics platform featured predominantly throughout the empirical analysis of Chapters 5 through 10 and 12.

Chapter 7 examines the bubble that occurred in the United States in the 1920s. The roaring twenties in the United States was a decade of increasing prosperity, the democratisation of investment and the development of transformative technology. Between the start of 1927 and October 1929, the Dow Jones Industrial Average increased 127 per cent. Then at the start of October 1929, the Wall Street crash occurred, and the market had lost 48 per cent of its value in a matter of five weeks. The chapter then moves on to explore how the bubble triangle explains the US bubble during the roaring twenties. The spark was electrification, which rapidly transformed the American economy. Marketability was high due to the new financial-market infrastructure in place to channel the massive savings of the middle classes towards governments and firms. Monetary conditions were not excessively loose, but the rapid rise of broker loans and buying on margin meant that there was a lot of credit underpinning investment in stocks. Speculation was rampant, with many ordinary people buying stocks in the hope of a quick capital gain. The chapter concludes by examining the contribution of the bubble and Wall Street crash to the subsequent Great Depression.