Stock Market Crash; 1929Consequential to World War 1, an epidemic of rebirth became the spirit of most Americans. Electricity became more popular across the board. The same occurred with the purchasing of appliances in electrical form. Also, to lower the cost of production of cars, Ford made assembly lines happen. The new technology and improved production process was the fuel to the fire in the economic expansion.Due to such an epidemic, the stock market grew substantially. In three years, 1926-1929, the total index of the market boosted 400%. Noticing this great jump, investors considered the wealth that could be made. Banks and stock brokers brought this buying frenzy to a great height.There are three infamous days that led up to this grievous happening:October 24th, 1929 (Black Thursday)-The average trades in the stock exchange were 4 million trades a day. On this first day, that number sky rocketed to 12.9 million shares. Due to this drastic jump, the tracking system of market prices could not keep up with the bulk of trading. This may have put in its two cents with selling frenzy on Black Thursday. Ticker tapes could not keep up with the pace, and became at least 90 minutes behind the market. In result of October 24th, 1929, a 9% decrease in the market occurred.The next day, Friday, the market had slightly recuperated. In thoughts that the market could rebound, investors sense of security went up over the weekend. Instead, the opposite happened.October 28th, 1929 (Black Monday)-Again, there was a bulk of trading happening and the pressure was on with the transfer of information. Nearly 9.25 million shares on Black Monday. There was no silver lining to look for at this point. Another 13% went down the drain at the end of the day.October 29th, 1929 (Black Tuesday)-On this day there was a record 16.4 million shares. The ticker tapes fell twice as far behind than on Thursday. Along with that, the market dropped another 12%. The hope of compensation was gone for good. This was the day that ended it all and was, as many historians say, the main cause to the Great Depression.The Great Depression; 1929-1939The Stock Market Crash was not the only cause of the Great Depression. Even though many other things happened due to the crash. Bank failures were one of these. Many people who had saved their money in one of the 9,000 banks that failed lost all of their savings. The cause of this was the bank deposits were uninsured. Those who did persevere through this time were leery about creating loans knowing they could end up nonexistent. This lead them to take in less and less money.Just like a car crash, more problems kept piling up. The chain reaction had started. Americans of all classes stopped purchasing items. Then the production of products reduced immensely, and in result, workers had to be laid off. Even those who did keep their jobs, the paycheck decrease 60%. The rate of unemployment went from 9% to 25%. It made no difference if you had a job or not because you would still not be making enough to support your family. Installment plans really harped on the Americans. Most items were repossessed and more inventory began to accumulate.In hopes of protecting American companies, the government created the Smoot-Hawley Tariff in 1930. This made foreign countries want to trade with us less because of the high tax charge.The drought of 1930 in the Mississippi Valley cause many farm owners to sell what they have or they couldn't pay their taxes or other debts.I found a song, by Blind Alfred Reed that's based on the times of the Great Depression.sources
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my sources are
http://www.money-zine.com/Investing/Stocks/Stock-Market-Crash-of-1929/
http://americanhistory.about.com/od/greatdepression/tp/greatdepress...
and the song is at this website.
https://www.youtube.com/watch?v=jYsSVNl8xmE