Causes of 1929 Stock Market Crash The Great Depression

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Are We Headed for Another Great Depression? Lessons from 1929 • Description: • On September 3rd, 1929, the US stock market reached historic heights. Shockingly, within just one month, on October 29th, 1929 (known as Black Tuesday), the stock market plummeted by 25%. By 1932, it had lost a staggering 90% of its peak value. During this time, 15 million people were left unemployed, and it took a quarter-century for the stock market to recover to its 1929 peak. • The question that arises now is: Are we on the brink of another Great Depression? • To predict the future, we must study the past. In this video, I will delve into the main causes that led to the Great Depression of 1929. • Intro: • Welcome back to my channel! I'm Kanak, and if you're interested in captivating content related to finance, investing, and economics, don't forget to hit that subscribe button! • Main Content: • The 1920s Era: • The 1920s were famously known as the Roaring Twenties. It was a time of tremendous economic prosperity, driven by groundbreaking technologies like automobiles, radios, and refrigerators that made life more convenient. Increased consumer spending fueled employment and salary growth, which, in turn, boosted the economy and the stock market. With more people investing and speculating, banks used deposits to provide loans for stock purchases, creating a speculative bubble that characterized the 1920s. • The Start of the Downfall: • To curb rampant speculation, the Federal Reserve began raising interest rates in 1928 and 1929, triggering the beginning of the market's decline. On September 3rd, 1929, the stock market reached its zenith, but by October 29th, 1929, Black Tuesday, it had plummeted by 25%. • Causes of the Downfall: • As the stock market crashed, people lost their savings, leading to decreased demand for American-made goods and overproduction in factories across the United States. Layoffs followed, resulting in massive unemployment—almost 30% of the population was jobless, and those still employed struggled to make ends meet. • Other factors exacerbated the Great Depression, including the banking crisis, with almost 50% of US banks collapsing. Heavy tariffs on imports and exports due to trade disputes worsened the global economic situation. Additionally, severe droughts in the 1930s caused a decline in agricultural production, compounding the economic challenges. • Similarities to the 2020s: • Remarkably, parallels can be drawn between the 1930s and the ongoing 2020s. Both decades feature stock market euphoria, sudden crashes (in 2020, due to COVID-19), Federal Reserve interest rate hikes, European conflicts, and talk of trade wars between the United States and China. History may not repeat itself, but it certainly rhymes. • If history serves as a guide, it's time to exercise caution when considering what lies ahead for the global economy. • #stockmarket #1929 #greatdepression #stockmarketcrash #stockmarketcrash2008 #stockmarkethistory #stockmarket1929 #investoreducation #investingeducation #stockmarketcrash2020 #stockmarketrisk #riskmanagement #stockmarketcollaps #ushistory #useconomy #federalreserve #centralbanks

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