Black Tuesday- was the most catastrophic stock market crash in the history of United States. The price of stocks completely crashed and eliminated many American jobs.
Speculation- investment in stocks involving risk but offering the chance of gains such as profit from changes in the market price.
"Buying on Margin"- People buy stocks with borrowed money and pay back the borrowed money with the profit earned from the stock. This caused problems because if the stock decreased in value then the person could not pay back the borrowed money. Buying on Margin became so popular that by 1928 the stock market doubled.
NYSE (New York Stock Exchange)- is one of the largest stock exchange facilities located in New York City, New York. The New York Stock exchange on …show more content…
By 1929, about 2/3 of the money (8.5 billion dollars) in the stock market was loaned. Big amounts of money in the stock market meant the price of shares went up, making more money for investors. Americans thought that the stocks and the share prices would continue rising, resulting in more profit. This ideology encouraged more people to invest more money. The crash began on October 24, 1929 and within a week total market value had dropped 30 billion dollars. Some people lost confidence in the market and sold their shares causing the value of the market to decrease even more, which led to a mass panic selling. The market lost 11% of its value in 1 day. When the market into panic, investors went to the bank to sell their shares. However, since the banks were also heavily invested in the stock market with all the loans, they did not have enough money to pay back the investors. With the market crashing at a very fast pace the investors could not get their money out before it was all gone. The stock market crash plunged America into the Great Depression, a time of panic and
Speculation- investment in stocks involving risk but offering the chance of gains such as profit from changes in the market price.
"Buying on Margin"- People buy stocks with borrowed money and pay back the borrowed money with the profit earned from the stock. This caused problems because if the stock decreased in value then the person could not pay back the borrowed money. Buying on Margin became so popular that by 1928 the stock market doubled.
NYSE (New York Stock Exchange)- is one of the largest stock exchange facilities located in New York City, New York. The New York Stock exchange on …show more content…
By 1929, about 2/3 of the money (8.5 billion dollars) in the stock market was loaned. Big amounts of money in the stock market meant the price of shares went up, making more money for investors. Americans thought that the stocks and the share prices would continue rising, resulting in more profit. This ideology encouraged more people to invest more money. The crash began on October 24, 1929 and within a week total market value had dropped 30 billion dollars. Some people lost confidence in the market and sold their shares causing the value of the market to decrease even more, which led to a mass panic selling. The market lost 11% of its value in 1 day. When the market into panic, investors went to the bank to sell their shares. However, since the banks were also heavily invested in the stock market with all the loans, they did not have enough money to pay back the investors. With the market crashing at a very fast pace the investors could not get their money out before it was all gone. The stock market crash plunged America into the Great Depression, a time of panic and