Effects Of Black Tuesday

On October twenty-ninth, 1929, investors on Wall Street traded about sixteen million shares in a single day on the New York Stock Exchange. Billions of dollars were lost that day causing thousands of investors to be wiped out. This day would come to be called "Black Tuesday." After Black Tuesday the economic state of America and the rest of the industrialized world took a turn for the worse. The ten years after the stock market crash was the deepest and longest lasting economic depression in history up to that time know as the Great Depression. During the 1920s, the stock market grew rapidly. The end of World War I brought an era of confidence, enthusiasm, and optimism to the United States. Innovative advances such as automobiles, radios,

Gaining profits off the stock market seemed so promising that even many companies placed money into the stock market. Some banks placed money in the stock market that belonged to the customers without the customers ' knowledge. Everything was going good while stock prices were rising but when the crash hit, people were take by surprise even though there had been warning signs. On March twenty-fifth, 1929, a mini-crash occurred in the stock market. Prices began to drop causing panic across the country. Reassurances from banks that they would keep lending stopped the panic. By the spring of 1929, there were more signs that the economy might be headed towards a major crash. House construction went down, steel production decreased, and car sales lowered considerably. There were also some people with knowledge of the stock market who were warning others that a serious setback would be coming. However, as the months went by, these cautious people were

Stock prices reached the highest levels in history up to date from June to August. Many people considered the continual rise of prices inevitable. An economist from that time said that the stock prices would remain permanently high, which was what many investors wanted to believe. The stock market reached its peak on September third, 1929 with the Dow Jones Industrial Average closing at 381.17. The market started dropping two days later. There was no tremendous drop at first. Throughout September and into October stock prices varied. On October eighteenth, prices began to fall. Panic set in. Then Black Thursday struck. On the morning of October twenty-fourth, 1929, a record 12,894,650 shares were traded. Leading banker and investment companies tried to stabilize the market. They did this by buying up large amounts of stock. This caused the market to improve slightly on Friday. However this improvement would be very temporary. Many speculators were shocked by the low numbers shown on Friday and wanted to get out of the stock market before all they had was lost. Many decided to sell their stocks. This caused a