STOCK MARKET CRASH 1929

CAUSES

• Overvalued stocks
• Investors pay only 10% of the stocks and would pay the rest in installments
• Many banks were being made with bad structure and many also failed
• 5% of stock market was margin buying
• Foreign investors started leaving

DEMAND AND SUPPLY

• Many companies had more production than they were selling
• Cars and steel-production line increased production
• People stopped buying expansive cars
• Agriculture- technology increased production
• People's consumption did not increase at the rate of production

DARKEST DAYS

• Black Thursday: On Oct. 24th
• the huge record was set of 12,894,650 of shares were traded.
• Stock prices fell 11%
• Black Monday: Oct. 28th
• Investors Dow Jones loses 38.33 (13%)

BLACK TUESDAY

• Oct. 29, 1929: largest stock market crash
• Dow Jones fell 25% and loses 30 billion dollars.
• 16 million shares were traded

EFFECTS

• 14 BIllion of wealth.
• Another huge crash happened in 1932
• The Glass-Stegall Act was passed
• commercial and investment banks could not associate with the stock market