The United States had begun a new era shortly after World War One. Many people had begun investing their money at their homes and even investing the money in the banks. The people had begun to move to new cities in hope to provide a better life for their families. During 1920s, the stock market didn’t come across as a risky investment until 1929. The stock market began to pick up the paced by 1928. The Stock Market was a huge mess because people started investing their money without knowing the history behind the stock market and the after effects it that led to the Great Depression.
The market was an eight-day period that had stock pricing down beginning on October 21, 1929. The stocks went straight downhill as most of the investors began selling off a large portion of their stocks. This was the start to destroying wall street and leading to the Depression. “The stock market crash of 1929 strengthened the nation as it led to multiple policies such as the Glass Steagall, Security Exchange Act, and the Social Security Act (Maury)”. The stock market crashed due to several reasons. After World War One, the stock market had increase drastically. Most of the people believe that they could build profits on stocks and invested in them. The people didn’t have the money to invested with, but it didn’t stop them from borrowing the money from the banks. This process was called “Buying on Margin’’. The people that had borrowed the money from the banks had simply felled into bankrupt. The production of electrical appliances had come around people went all out to purchase the appliances. People used credits card and gave them time to pay later for the appliances. The business lost money by not making the people pay up fronts the materials. This cause many businesses to shut down and causing the stock market to go down.
There were a few leading events on how the stock market crashed. During August 8, the Federal Reserve Bank of New York raised the discount rate to about six percent. The Bank of England had also decided to raise their rates to protect the gold standard. The stock mark crashed had completing wipe the people out of everything they had. The Dow had peaked at 381.17 with a 27 increase over the year. According to The Stock Market Crash, “ stock prices were overpriced, and many people believe that the stocks were overpriced and that the prices would go back to the normal rate.” Massive Fraud and illegally activity were also the caused to the stock market down fall. The Public Officials Repeated Statements was also the caused to the stock market failing.
Works Cited
Events That Led to the Stock Market Crash of 1929. “Humanities360. Helium Inc, 2013. Web. 12 Nov. 2013
The Stock Market Crash of 1929, “About.com 20th Century History. Web. 17 Apr. 2012
Klein, Maury.” The Stock Market Crash of 1929: A Review Article.” Business History Review 75.2(2002): 325. Academic Search1 Complete. Web. 28 Mar. 2014
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