Reasons Why the Stock Market Crashed

Topics: Wall Street Crash of 1929, Stock market, Stock market crash Pages: 2 (523 words) Published: March 26, 2013
Dear Corrupt Government,
It has come to your attention of the three factors that brought on the stock market crash of 1929. This is a very important issue to me and i believe the three main reasons as to what cause the stock market to crash. One reason is buying on margin. The second reason is the gov't creating easy money. The last reason the stock market crashed was stocks being priced hired than actual value. I hope you will consider my position on the issue and as well as the rest of my essay.

The first reason I believe the stock market crashed was buying on margin. This let a lot of people essentially borrow money from stock brokers. In the article "What caused the wall street crash of 1929" they said buying on margin lead people to owe a lot of money from losing money in stocks. The article also mentions that this resulted in banks closing and going out of business. These are all very important facts to be considered when answering the question of what caused the stock market to crash.

The second reason I believe the stock market crashed was the gov't faking an economic rise. In the article "The Great Depression" it said that the gov't created a fake boom through easy money and credit which was followed by a huge bust. This is then how the stock market crashed from all the fake economic rise. In addition, the low interest rates and low rates to buy on margin both made share holders want more stocks because they were so cheap. I believe these facts to be considered when choosing the three reasons of why the stock market crashed.

The third reason why i feel the stock market crashed was the stocks being sold for much higher than they are worth. This meant a lot of people lost money and a few gained a lot of money. In addition, this meant that people who bought on margin where owing stock brokers a lot of money they didn't even have to start off with. In the article "Black Tuesday" it says stocks lost more than $26 billion in value and over 30 million...
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