Causes of the Stock Market Crash
The popular belief was that the stock value in any given company would keep going up, so people invested everything they had in anything they wanted. Many people speculated that the market would eventually have to fall, but the public didn't listen. People were borrowing money to buy stocks, which is a very dangerous practice. When the market prices began to fall, people began to sell their stocks in a panic, which lowered the value of the stock even further. This happened to just about every company--many companies went bankrupt.
Causes of the Great Depression
The Stock Market Crash of 1929 ultimately led to the Great Depression. The aftermath of the crash caused over 9,000 banks to close. Because bank deposits were uninsured, when banks failed, people lost their savings outright and had no way to recover it. People became afraid to buy stocks, and that only fueled the downfall of the market. Businesses were closing down all over the country and unemployment went through the roof, reaching almost 25% nationally. The drought in the Mississippi Valley (nicknamed The Dust Bowl), while not a direct cause of the Great Depression, destroyed the fields of many farms. Farmers had to sell their farms for little or no profit to themselves. As a result, they couldn't pay their taxes and other debts and many farmers slipped into extreme poverty.
Depression in the Cities
Cities that relied heavily on manufacturing as a source of income were hit hard by the Great Depression. Because the unemployment rate skyrocketed during this time, this meant no jobs to produce such things as automobiles and steel for railroads. Suicide rates increased dramatically during this time, with people jumping off of buildings and ending their lives out of the fear that the economy would never prosper again. Organized crime also gained power and influence during this time. People became desperate for employment and a source of income, and so they turned to the mafias that were organized within their cities. Mafias ran casinos and brothels and other illegal businesses to make money. City officials often simply ignored these activities, because they didn't want to hurt the businesses that were actually managing to succeed during the harsh times.
www.angelfire.com/co/pscst/stock.html
http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929#Timeline
http://americanhistory.about.com/od/greatdepression/tp/greatdepression.htm
Comments
Good info but be sure to add personal thoughts.