The market then recovered for several months, starting on November 14, with the Dow gaining The following year, the Dow embarked on another, much longer, steady slide from April to July 8,when it closed at For the rest of the s, beginning on March 15,the Dow began to slowly regain the ground it had lost during the crash and the three years following it.
The initial decline in U. The s had been a prosperous decade, but not an exceptional boom period; prices… During the mid- to late s, the stock market in the United States underwent rapid expansion.
People sold their Liberty Bonds and mortgaged their homes to pour their cash into the stock market. In the midsummer of some million shares of stock were being carried on margin, pushing the Dow Jones Industrial Average to a peak of points in September.
Any warnings of the precarious foundations of this financial house of cards went unheeded. View of the New York Stock Exchange on an active day in the late s.
Share prices peaked in August before falling rapidly in October of the same year. Library of Congress, Washington, D.
Prices began to decline in September and early October, but speculation continued, fueled in many cases by individuals who had borrowed money to buy shares—a practice that could be sustained only as long as stock prices continued rising.
On October 18 the market went into a free fall, and the wild rush to buy stocks gave way to an equally wild rush to sell.
The first day of real panic, October 24, is known as Black Thursday ; on that day a record Still, the Dow average closed down only six points after a number of major banks and investment companies bought up great blocks of stock in a successful effort to stem the panic that day.
Their attempts, however, ultimately failed to shore up the market. The panic began again on Black Monday October 28with the market closing down On Black Tuesday October 29 more than 16 million shares were traded.
The Dow Jones Industrial Average lost another 12 percent and closed at —a drop of points in less than two months. Prime securities tumbled like the issues of bogus gold mines.
General Electric fell from on September 3 to on October American Telephone and Telegraph dropped points. Political and financial leaders at first affected to treat the matter as a mere spasm in the market, vying with one another in reassuring statements.
Another 20 years would pass before the Dow average regained enough momentum to surpass the point level. Many factors likely contributed to the collapse of the stock market. Among the more prominent causes were the period of rampant speculation those who had bought stocks on margin not only lost the value of their investment, they also owed money to the entities that had granted the loans for the stock purchasestightening of credit by the Federal Reserve in August the discount rate was raised from 5 percent to 6 percentthe proliferation of holding companies and investment trusts which tended to create debta multitude of large bank loans that could not be liquidated, and an economic recession that had begun earlier in the summer.
Learn More in these related Britannica articles:The Wall Street Crash of , also known as the Stock Market Crash of or the Great Crash, is the stock market crash that occurred in late October, It started on October 24 ("Black Thursday") and continued until October 29, ("Black Tuesday"), when share prices on the New York Stock Exchange collapsed..
It was the most devastating stock market crash in the history of the United. Explain why speculation caused the Wall Street Crash. [6 marks] Each player starts with $ in their piggy bank.
The bank begins with 5x 'IOU's. After each round you will decide what to do with your money. Place extra $ at side of the board - this represents consumer spending.
The market is closed on Monday, but that doesn't mean you have to take a day off from your love of Wall Street (obviously). With you free time, catch up on the classics or maybe see something new. Panic on Wall Street: A History of America's Financial Disasters [Robert Sobel] on timberdesignmag.com *FREE* shipping on qualifying offers.
The financial panics analyzed in this book illustrate the complexity of such events and that the causes are varied: political. Stock market crash of Stock market crash of , a sharp decline in U.S. stock market values in that contributed to the Great Depression of the s, which lasted approximately 10 years and affected both industrialized and nonindustrialized countries in many parts of the world.
Learn more about the crash in this article. Contents. Stock Market Crash ; Stock Market Crash and the Great Depression ; On October 29, , Black Tuesday hit Wall Street as investors traded some 16 million shares on the New York.