Today we continued watching a video called the Crash of 1929.1. What is Pooling?Wealthy people got together and pooled their money into a stock to make its value go up then sell it for a big profit. They would take a cheap stock and pay off newspaper to write nice things about the stock. They also make it look like they are accumulating the stock and people start buying and then they sell and the stock would collapse.2. What did the Federal Reserve Board do?The board started to see the truth of the borrowing. They raised interest rates so that people would stop buying on margin. This started people panicking and they began sell but people tried to keep their stocks by borrowing more money but that caused interest rates to continue to rise.3. What caused the crash?The stocks were in so much demand that they kept going up while the company value didn’t match. The stock market was uncontrolled. People bought on margin. Sales dropped and people fell into debt.4. Story of the Stock Market Crash.Stock prices started to go up and up. It soared to record heights. People just kept buying on margin and they thought it would last forever. Once people started to figure it out people started to sell and this caused more people to sell and it just made it worse.
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