The Crash Of The Stock Market Jump Started The Great Depression

1450 Words Apr 21st, 2016 6 Pages
The crash of the stock market jump started the Great Depression. However, it was not the only cause. War reparations, bank failure, irresponsible governments, and export duties all contributed to the development of the depression. Although the Great Depression originated in the United States, it quickly spread to many parts of the world. Through the 1920s the stock market in the United States grew tremendously, reaching its climax in August 1929. After August, production began to decline and unemployment was on the rise. Stock prices were left in great excess of their actual value. The prices on the market began to decrease in September and early October. On October 18 the decline began, “and on October 24, Black Thursday, a record 12,894,650 shares were traded.” Banks and investment companies began buying stocks to try to balance out the market. On Monday, the market took a nose dive. Black Monday was followed by Black Tuesday, October 29, 1929, when prices crumbled completely, 16 410 030 shares were traded in a single day. “Stock tickers ran hours behind because the machinery could not handle the tremendous volume of trading.” Investors who bought on margin were completely bankrupt. “Many Americans forced to buy on credit fell into debt, and the number of foreclosures and repossessions climbed steadily.” This was the beginning of a decade of debt, despair, and depression. “The Great Depression was the deepest and longest-lasting economic downturn in the history of…

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