Black Thursday: A Long Lasting Domino Effect

During the 1920's millions of Americans began investing in stocks for the first time. They heard about how rich people were getting by investing so they all decided to do it. Many new investors entered the stock market using borrowed money. Stock market prices rose steadily as inflated market demand outpaced increases in the capital value of businesses. Investors began to realize that a large imbalance existed between stock prices and the amount of money needed to back them up, and began to sell. On October 29, 1929, great numbers of people tried to sell their stocks all at once. This created chaos in the accounting of stocks and for brokers. The New York Stock Exchange and other exchanges prices dropped so dramatically that this event became known as the crash of 1929. Millions of investors lost their savings in the crash and many were deeply in debt since

After the crash, many business failed, banks closed, and because of that, lots of workers were out of job. Homes and farms had been lost to foreclosure. In 1933, the government finally decided to do something, congress passed the Securities Act of 1933, which required companies that sold stocks and other securities to communicate important information to consumers and set up systems to prevent fraud. The law was strengthened in 1934 when congress created the Securities and Exchange commission (“Black Tuesday”). Herbert Hoover, the president of US during this event, thought the stock market would get better within 60 days (Stock). The crash also helped lead to the onset of the Great Depression by undermining confidence in the economy, but it

The Stock Market Crash occurred on October 29th, 1929. Wall Street got struck on Black Tuesday when, on the New York Stock Exchange, investors traded 16 million dollars worth of shares in one single day. Billions of dollars were cut, destroying the investments of thousands of investors. After the event of Black Tuesday, America’s industrial world spiraled downwards into the Great Depression. This was the most powerful and extended economic breakdown in the history of the Western Industrial world up till then.

Indeed, the stock market crash triggered this event, however the vastly poor distribution of wealth, the wages of industrial workers, and the profitless work of farmers all added up to this downfall. In addition, high tariffs set by the U.S. made it difficult for foreign nations to sell goods to them and to buy goods in return. And to make things better, banks were failing and in result wiping out life savings of hundreds of people. The last straw was drawn when the stock market hesitated and investors began to sell their stocks for fear of what could happen. Brokers jammed the stocks as they attempted to unload shares. This grave dip became a panic that would be known as black Thursday. The following Tuesday all stocks had lost six-sevenths of their value, and it would be appropriately called black Tuesday. With thousands of people’s life savings gone overnight, the economy suffered immensely. Due to the lack of money people began to stop buying goods. To make up for the lack of revenue, businesses laid off countless workers to decrease the price of their outputs. This only furthered the issue into a never ending cycle. People now without jobs could not afford goods, and businesses continued to lay off its workers to stay profitable. Millions of Americans lived in poverty at this time, many unable to buy the

The name they gave this day was “Black Thursday”. After these dark days in America, the stock markets had officially crashed and sent America’s economy plunging down the drain.

Billions of dollars were lost which put many into a panic and eliminated thousands of investors. On October 29th, what is known as Black Tuesday, stocks completely collapsed and $30 billion had disappeared. An enormous count of nervous people lined up to withdraw their deposits in cash leading to bank failures across the country. Stock prices dropped twenty percent of their value and continued to fall until late 1932.

On October 24, 1929, the stock market crashed as investors began selling off their shares as quickly as possible. That day is known as “Black Thursday” on which a record 12.9 million shares were traded in. Five days later, on “Black Tuesday” another 16 million shares were traded in. Investors wanted to get as much money out of their stocks in case they went down in value. Everyone who had bought stocks “on margin” lost everything. This affected Europe as well as America. People had less money, there was less demand

-On “Black Tuesday” many people who had invested in the stock market lost everything in the crash. The Stock Market crash was perhaps the single most dramatic event

First, it all started when new inventions were coming out such as refrigerators and automobiles. People who could not afford them in the first place were buying them off credit. So already people had become in debt (Hayes). Then the stocks started to deplete and people got nervous and tried to sell them in a hurry. This caused the market to crash and everyone lost their money in the bank. At first the poor thought the rich could only be affected but soon that was not the case (Hayes). This day became known as Black Thursday and will be remembered forever.

During the 1920s many people invested their money into the stock market, a place where shares of public companies are traded through exchanges or over the counter markets. Their investments in stock brought them much wealth. Feeling confident, the investors took out loans from the banks to invest more money. On October 29, 1929 stock prices fell to an extreme. Causing the value of the stocks to tumble. Investors began to sell their stocks. As the prices kept falling the investors panicked, this lead to even more selling. Banks kept asking for

Consumer spending fell & there was an unhealthy surplus of non-distributed/non-sold goods which slowed production down. At the same time, stock prices rose gradually and reached an unreasonable high. On the 24th of October in 1929, the balloon was popped, as investors began to dump shares. A record of 12.9 million shares were traded on that day, and the day was therefore known as “Black Thursday”. (Paraphrase, history.com)

Black Thursday helped cause something terrible, so terrible that it is still the worst economic depression in the history of United States capitalism. Although Thursday, October 24, 1929, was the first day of the crash, it was far from the worst. The following Tuesday, Black Tuesday, set a new record: 16,410,030 of stocks traded in a single day, which broke the record 12,894,650 set on Black Thursday (Bierman). The crash was a large contributor to the Great Depression, but fallout would have been relatively small if it was not for other factors (Appleby).

Many held onto their stocks until they reached a high enough point, then selling them at a much higher price that they had bought them, making a hefty profit. This worked well for a long time, but soon enough skeptical people would lose confidence in the market and would begin to sell their stocks. This ruined the idea that stocks were increasing in value. People no longer held onto their stocks in hopes to make a profit. Instead they would want to sell. Eventually everyone wanted to sell and prices fell drastically. (The Great Crash 1929-Galbraith) This is the way the market crashed in 1929. In years leading up to 1929 when speculation was high and stocks were being purchased, they were bought on a ten percent margin. This meant that investors were putting up only ten percent of the actual price of a stock. The remaining ninety percent was borrowed from banks or brokers. Many thought that they would be able to repay loans and gain profit when they sold their stocks later on. This led to eight billion dollars of stock loans which president Hoover had to liquidate.(The memoirs of Hebert Hoover)

This became the stock market crash. This day, October 24, 1929, became known as Black Tuesday. In the crash, people lost ten times as much as they put in. After all that everyone lost there trust in the economy. Many people wanted to take their money out of the bank. Banks were running out of money. Because of the cash shortage many banks got closed down.

On August 24th, the Chinese government depreciated their currency which cause major panic in stock markets across the world. Within minutes after the opening bell, the Dow plummeted 1,089 points. That is the largest point loss ever during a trading day, surpassing the Flash Crash of 2010.