The Stock Market Crash Of The 2000's
As the Roaring Twenties decade was winding down to an end, the strength in America’s economy continued to grow weaker. The stock market had been falling at such a rapid pace, that it had become questionable on whether or not the United States would be able to recover, because it had led the United States into a depressing period in history.
The stock market had officially reached it’s lowest point on October 29, 1929. Leading up to this day, there were several stock markets across the country that had begun to lose value of majority of their stocks, compared to the beginning of the decade (Selby). This was because A clear representation of the stocks falling was known as the American Stock Exchange. The American Stock Exchange, which can often …show more content…
This is how margin buying, which allowed any person to buy stock with only a percentage required to be paid immediately, started (Selby). Margin buying had made the stocks more affordable for the people, however, it made the banks weaker because they would continue to lose money (Selby). Some investors got bank loans to help them pay for the margin buy, which took even more money from the banks (Selby). This had resulted in there being little money to support the stocks’ values (Selby). Another factor of the stock market crash was that key economic symbols had begun to decline (“The Stock Market: Crash”). These symbols had included the freight car-loadings, and housing starts (“The Stock Market: …show more content…
President Herbert Hoover made a solution that seemed to help this. He said that Americans were to continue to rely on themselves, because it was believed that self-reliance would help the people “pull them up by their bootstraps”, which created his theory of “rugged individualism” and volunteerism (Lange 39, Thomas). Many believed that the marketplace would use this plan to adjust itself eventually, and that the government should not intervene nor assist (Lange 39). There were many families that asked for assistance from the government, due to the fact that they had lost almost everything they owned, including their homes, but the government did not help them (Lange 38). President Hoover had felt that the government’s aid would weaken the country’s character, and that it should not be provided to the people (Lange 40). His administration was not immune to the people suffering, however, he did not just watch the suffering happen (Lange 41). This lead to the establishment of the Reconstruction Finance Corporation in 1932 (Lange 41). “Loaned money to state and local governments, who would then use it to start public work projects, and to failing businesses, including banks, railroads, insurance companies, and farm mortgage organizations” (Lange 41). If these industries could remain secured, then they would be able to continue to employ workers, and in hopes that the unemployment rate gradually decrease
The stock market had officially reached it’s lowest point on October 29, 1929. Leading up to this day, there were several stock markets across the country that had begun to lose value of majority of their stocks, compared to the beginning of the decade (Selby). This was because A clear representation of the stocks falling was known as the American Stock Exchange. The American Stock Exchange, which can often …show more content…
This is how margin buying, which allowed any person to buy stock with only a percentage required to be paid immediately, started (Selby). Margin buying had made the stocks more affordable for the people, however, it made the banks weaker because they would continue to lose money (Selby). Some investors got bank loans to help them pay for the margin buy, which took even more money from the banks (Selby). This had resulted in there being little money to support the stocks’ values (Selby). Another factor of the stock market crash was that key economic symbols had begun to decline (“The Stock Market: Crash”). These symbols had included the freight car-loadings, and housing starts (“The Stock Market: …show more content…
President Herbert Hoover made a solution that seemed to help this. He said that Americans were to continue to rely on themselves, because it was believed that self-reliance would help the people “pull them up by their bootstraps”, which created his theory of “rugged individualism” and volunteerism (Lange 39, Thomas). Many believed that the marketplace would use this plan to adjust itself eventually, and that the government should not intervene nor assist (Lange 39). There were many families that asked for assistance from the government, due to the fact that they had lost almost everything they owned, including their homes, but the government did not help them (Lange 38). President Hoover had felt that the government’s aid would weaken the country’s character, and that it should not be provided to the people (Lange 40). His administration was not immune to the people suffering, however, he did not just watch the suffering happen (Lange 41). This lead to the establishment of the Reconstruction Finance Corporation in 1932 (Lange 41). “Loaned money to state and local governments, who would then use it to start public work projects, and to failing businesses, including banks, railroads, insurance companies, and farm mortgage organizations” (Lange 41). If these industries could remain secured, then they would be able to continue to employ workers, and in hopes that the unemployment rate gradually decrease