The present rules came into force with the Securities Act of 1933, which was written during the great depression to protect people from the kind of predatory "i

The present rules came into force with the Securities Act of 1933, which was written during the great depression to protect people from the kind of predatory "investments" that caused a lot of people to lose their savings in the crash. The last part of the bubble in late 20's was characterized with the lower middle class, which previously didn't have much investments, getting involved with the stock market. A lot of companies of all sizes advertised their stocks and "expected returns" in everything from radio to milk labels. Too many people bought into it at the worst possible time, on the top of the bubble.