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The Repercussions Of The 1929 Stock Market Crisis

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The 1929 stock market crisis resulted in significant losses for the American people. It began in September and lasted till mid-November. The repercussions of the crash led to lost salaries and unemployment, businesses closing, homelessness, and many other life-changing events. It also began in New York City at a time when the American people were thriving in life. What caused the 1929 stock market crash? What event or events produced such an economic disaster for America? Could the accident have been avoided? There are several reasons behind the stock crash, but the banks of America may hold some answers.

The article, "The Money Market in 1929" which was written by W. Randolph Burgess, discusses the four major events that affected the money market. The first event was when the Federal Reserve changed its discount rate from 5 to 6 percent. The second event was when foreign exchange rapidly strengthened. The third event was when the money rates rapidly declined in October. Last but not least, when the break in the stock market prices occurred. The result of all of these events is all theories as to why the stock market crash happened. Throughout the article, W. Randolph Burgess discusses how the federal reserve helped with the crash. Towards the end of the article, Burgess …show more content…

Edie supports the theory that Americans borrowed more money than they could pay back. The article "The Banks and the Stock Market Crisis of 1929" helps bring light to New York banks' perspective. It states, "Between October 16 and October 30, brokers' loans for others decreased $1,411,000,000, about 36 per cent (Edie, page 18)." It is considered that the fear of equities dropping prompted the stock market to crash. There are many theories behind that as well. Nobody knows why people suddenly took their funds away. It could be the fear of funds becoming frozen, the need for enough funds to acquire bargains in the stock, or the use of funds to promote firms'

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