What Are The Causes Of The Stock Market Crash

They had purchased stock in companies whose shares were now crumbling in value” (Ayers 678). After the stocks crashed, people who were invested in them, lost thousands even millions of dollars. The banks were the top investors so they lost the most amount of money with their invested stocks, along with the frightened depositors withdrawing their savings, draining money quickly from the bank. Hundreds of banks failed and shut down because of their loses. CLOSING STATEMENT: although, … Businesses were also affected by the Stock Market Crash.

The people that were affected the most by the Great Depression were stockholders. Thousands of stockholders lost enormous amounts of money on Black Tuesday. The rapid decrease of stock prices made stockholders lose their money within one day. Even though it was a devastating loss, there was no way to predict it. From 1925 to 1929, the average stock price doubled on the New York Stock exchange, making people invest ludicrous amounts of money in the hope that they would make a hug... ... middle of paper ... ...hange crash of October 1929 and therefore the succeeding depression alerted stockholders to be concerned about their own investments within the stock exchange instead of the data of other people’s investments.

The Great Depression was a period of first-time decline in economic movement. It occurred between the years 1929 and 1939. It was the worst and longest economic breakdown in history. The Wall Street stock market crash started the Great Depression; it had terrible effects on the country (United States of America). When the stock market started failing many factories closed production of all types of good.

Because so many people had bought on margin, the economy suffered from a severe lack of activity, creating a nationwide depression. People also lost their savings, as a result of banks using deposits to buy stocks. Other causes of the crash include over-speculation and overreaction. Over-speculation, the act of valuing

Causes of the Great Depression The Great Depression also called Depression of 1929, or Slump of 1929, began in 1929 and lasted until 1939. It was the longest and most severe depression ever experienced by the industrialized world. Though the United States economy had gone into depression six months earlier, the Great Depression may said to have begun with a catastrophic collapse of the stock market prices on the New York Stock Exchange in October 1929 call the Stock Market Crash of 1929. During the next three years stock prices in the United States continued to fall, until by late 1932 the had dropped 20 percent of their value in 1929 (http://www.britannica.com/bcom/eb/article/0/0,5716,38610+1,00.html). More than a half-century after the fact, there is no consensus on that caused the Great Depression.

The stock market crash was a key moment in triggering the Great Depression. Because of the Depression, it left millions of people unemployed through the years. President Hoover attempted to help but failed miserably and as a result wasn't reelected. The Farmers took a major hit from people not being able to buy their crops, to the blow of the Dust Bowl. The Great Depression will be known as the worst economic downfall in American history.

There were many elements that led to the Great Depression like the stock market crash, bank runs, the dust bowl, and the new deal. The Great Depression was an economic downturn between 1929-1939. Many people lost their jobs and did not have enough money to keep a roof over their head. Only the rich could manage while the unfortunate grieved. Both the rich and poor were petrified, and the rich even concealed their money so no one could take it from them.

The phrase “use it up, wear it out, make it do or do without” was used in abounding households during the Great Depression. The Great Depression was the most severe and longest depression experienced by anyone ever. It was a total economic slump that began in North America in 1929. Consumer spending and investment declined, causing industrial output to lessen which led to unemployment. When the Great Depression reached its lowest point, almost half of America’s bank had closed and 13 to 15 million people were unemployed.

Although this day is considered the trigger to the massive economic fallout, the American and global economies had been in turmoil for six months prior to Black Tuesday, and many other factors contributed to what’s known as the worst economic crash in modern history. With few regulations on the stock market in the years leading up to the Great Depression, investors were able to buy stocks on margin, only requiring them to put down ten percent. This caused for wild speculation, and many people funneling their life savings into the stock market, which led to artificially high prices. After Black Tuesday, many people began to believe that the banking system in America was going to fail. Thousands flocked to the banks to withdraw their money.

The effects of the Wall Street Crash were felt all around America as people starved, businesses became bankrupt and unemployment rose. This era was known as the Great Depression and would last for another ten to twenty years. In the short term, rich investors lost great deals of money. Whilst, poorer investors, who had borrowed ‘on the margin’, could not repay their loans and thus became bankrupt. After a while, these incidents began to affect the American public.