The Stock Market Crash of 1929

Stock Market Crash of 1929

The stock market crash of 1929 is known to be the major cause of the Great Depression. The crash occurred on October 29, 1929. It was also known as the Wall Street Crash or Black Tuesday. It is known to be the most devastating Stock market Crash. The investors exchanged 16 million of shares on the New York stock exchange in a single day. Soon after this crash, America had gone under, what we know as the Great Depression which is why it is known as one of the major causes of the Great Depression. 

During the 1920's, the stock market of the United States expanded rapidly. It reached its peak in August 1929. There are many reasons to this crash and the reasons began in August when the production declined and the unemployment risen. Causes of eventual market collapse included low wages, struggling agriculture and excess of large bank loans that could not be liquidated. 

This kept getting worse and worse and by September and early October of 1929, the stock prices began to decline. Data has shown that there were 12,894,650 shares traded on October 24, 1929 also known as the Black Thursday. However, stock prices completely collapsed on October 29, 1929 when 16,410,030 shares were exchanged. The loss was huge and included billions of dollars, eliminating thousands of investors. After October 1929, the stock prices were so low that they had no other way than going up and when the succeeding weeks came, America was hit by the Great Depression and the prices dropped again. By 1932, stock prices had decreased even more and their value was 20% of their value in the summer of 1929. By 1933, about half of the banks in America had failed and about 15 million people were unemployed. 

Although The Stock Market Crash of 1929 was not the only cause of the Great Depression, it is known to be a major cause because it was the disaster that transitioned America into the Great Depression.