Per 7 1920s Stock Market Crash


Summary:

Serious unemployment was a result of the stock market crash. 10-20% was taken out of their own money, and ended up borrowing about 80% from the stock. The stock market ended up causing The Great Depression. Many people expected the economy to get better. Billions of dollars were invested into the stock market. A lot of people who invested, invested a lot of their money. The banks ended up failing, and that's when The Great Depression began. Federal Deposit Insurance Corporation was created by the government to prevent similar disasters. Many people lost their jobs and houses. Compared to 2009's economy crash it was very similiar, everyone had lost either their houses or jobs because of a stock market crash. Today were still working to get back to where we were very similair for example the people of 1920 worked back around 1932. The stock market crash was caused by people who believed in the economic strengths , invested all their funds, and then lost everything they had.

 

Causes:

One cause of the crash of the stock market in the 1920 was, agricultural recession. The Agricultural sector struggled to maintain their profitability, farmers went out of business because they could not compete with the economic climate. Another reason was because new technology increased food supply. Another cause of the crash of the stock market in the 1920's was, the production and consumption, production line enabled the economies increase production. The consumption or demand, bought expensive cars and consumer goods, that caused production to struggle keeping up. Finally, another reason for the crash of the stock market in the 1920's was, inequality, consumption of goods was not equally matched with the economic growth. This made wealth in America unequally distributed.

 

Aftermath:

Reports of suicides were most likely exaggerations, however many people had lost their entire savings. Numerous companies were ruined and the faith in banks was destroyed. Economists and historians continue to study the Stock Market Crash of 1929 wanting to discover the secret to what started it and what instigated panic. There is hope that another severe crash will never happen again.  

 

 

 

 

 

 

WORKSITES:

http://eh.net/encyclopedia/article/Bierman.Crash

http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929

http://history1900s.about.com/od/1920s/a/stockcrash1929.htm