What were the causes of the Stock Market Crash of 1929?
The Wall Street Crash of 1929,[1][2] also known as the Great Crash or the Stock Market Crash of 1929, was the most devastating stock market crash in the history of the United States, taking into consideration the full extent and duration of its fallout. Four phrases—Black Thursday, Black Friday, then Black Monday, and Black Tuesday—are commonly used to describe this collapse of stock values. All four are appropriate, for the crash was not a one-day affair. The initial crash occurred on Thursday, October 24, 1929, but the catastrophic downturn of Monday, October 28, and Tuesday, October 29, precipitated widespread alarm and the onset of an unprecedented and long-lasting economic depression for the United States and the world. This stock market collapse continued for a month. ” Anyone who bought stocks in mid-1929 and held onto them saw most of his or her adult life pass by before getting back to even. ” —Richard M. Salsman[4] Effects and academic debate Together, the 1929 stock market c
Causes of the Stock Market Crash The 1920’s were a time of unbelievable prosperity. The stock market was going through the roof and the United States seemed to have the formula for limitless prosperity. However, the same formula that generated all of that profit would also be the cause of Black Tuesday. Investment during the 1920’s was based on the unstable basis of margin buying. Investors bought borrowed money from their brokers, who went to banks for that money. When stocks failed and investors needed to default, the money was permenantly lost. However, adding to the crash of ’29 was the slowing economy. The desire for consumer durables (expensive items refrigerators, radios, and automobiles) went down as Americans became satisfied with what they had. This in turn affected the companies and workers that produced these items. A downward spiral was set in motion. Causes of the Stock Market Crash The crash of 1929 ended the seemingly infinite prosperity of the 1920s. Millionaires had b
