The Day Wall Street Crashed
October 1929: The Bottom Falls Out
October 24, 1929 marked a major turning point in US and world history as the New York Stock Exchange saw the biggest single-day drop in its history. Though the warning signs had cropped up through the preceding spring and summer, nothing could prepare the public for the calamity that eventually occurred. The 1929 Crash, its causes, and consequences still echo in today’s culture as the onset of the Great Depression.
The Roaring 20s: A Bull Market
The decade of the 1920s in the United States is remembered today for its rapid economic growth, the development of mass popular culture, and increased consumerism. These trends were also marked by a major upswing on the stock market, as it became much more common for middle- and working-class people to buy and sell shares.
Wild Optimism
The stock market grew steadily throughout the 20s, leading to the general belief that the market would grow forever. The buoyant public mood led more and more people to put their money in the market, confident of gaining big returns.
Investment Vs Speculation
As share prices rose steadily through the 20s, a growing number of people began speculating on the stock market. Instead of investing in businesses based on fundamentally sound long-term business principles, these buyers sought to play the market for short-term gains.
The Strong Hand Of The Federal Reserve
Concerned about the growth of a stock market bubble, the US Federal Reserve raised interest rates in 1928 and early 1929. The economic growth in the US began to level off.
