Causes Of The Stock Market Crash And Depression Essay

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The stock market crash that occurred on October 24, 1929 sent the United States into a depression. There are multiple cause of the crash and depression and can only be blamed on the government and citizens. The crash created Black Thursday, marking the day that stock market prices plummeted. The crash eliminated about ten billion dollars in value, a huge loss for America’s economy. To try and fix the problem, J.P. Morgan and Company gathered and agreed to give twenty million to buy stocks to get the market running again. The stock market crash had many causes, a few include growth in bank credit and loans, the past actions of President Harding, and rapid expansion the country was not ready for. One of the newer inventions of the twenties was credit. This allowed middle and even lower class citizens to obtain a desired item and pay later. The types of items bought were more expensive like cars, washing machines, refrigerators, etc. Families started buying more than they could pay off and caused them to become financially troubled. They had a hard time paying back the money. Many companies were making big money and created huge revenue from families shopping sprees, causing them to produce more than they can afford. This production is known as company expansion, which caused over-production (Norton, 719). …show more content…

Harding became president in 1920 and disappointed many by his actions that caused controversy. He believed in the return to Normalcy and proposed this in his campaign. Harding caused much unrest in office. One of the major issues during his presidency is the Tea Pot Dome scandal, which was a government-owned oil deposit, administrated by the Interior Department. Harding let the Secretary of the department let private companies exploit the oil there and was discovered to have taken bribes to allow companies to have their way. While in office, Harding wasted much money, but many of his scandals were not known about till after his death

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