How Did The Wall Street Crash Affect The Economy

Sandeep Kaushik

The Wall Street Crash - An iSearch

Probably between 1.5-2K words

To what extent did the Wall Street Crash of 1929 have economic effects on the U.S.A. The Roaring Twenties. The years that one might consider to be a Golden Age in American history. As the world was recovering from the first World War, everything seemed tremendous, the stock prices continued to rise and the arrival of the automotive industry, led to prosperity in America during the 1920s. But the Wall Street Crash of 1929 had significant effects on the economy during that time period, and many years to come.

Leading up to the Great Depression, there was an abundance of factors,nationwide, which hinted towards an upcoming economic downfall. An economic slowdown

Sales reached 9,212,800.”(Sydney Morning Herald). President Roosevelt quickly to sent in billions of dollars into the economy through an abundance of relief programs. An observer of the crash, spoke of the extremely dangerous aspects of the situation, "The stock markets of this country tottered on the brink of panic, as prosperous people, gone suddenly hysterical with fear, lived through a financial nightmare comparable to nothing ever before experienced on Wall-street. It rocked the financial district to its foundations, and chilled its blood with terror. In a society built largely on confidence, with real wealth expressed more or less inaccurately by pieces of paper, the entire fabric of our economic stability threatened to come toppling down."(The Sydney Morning Herald). On October 24, or Black Thursday, the market lost 11 percent of its value as the morning bells rang. Several leading Wall Street bankers met to find a solution to the panic and chaos, the meeting included Thomas W. Lamont, acting head of Morgan Bank; Albert Wiggin, head of the Chase National Bank; and Charles E. Mitchell, president of the National City Bank of New York. They chose Richard Whitney, vice president of the Exchange, to act on their behalf (Reed 1). Eli Whitney placed a bid to purchase a large block of shares in U.S. Steel at a price that was much higher than the current market value. Whitney proceeded to place similar bids on other "blue chip" stocks. This tactic was used to end the economic panic in 1907, as everyone saw that large moguls still had faith in the stock market, they too continued to invest. The Dow Jones Industrial Average recovered, closing with it down only 6.38 points for the day. But as opposed to 1907, the recovery was only