The rise and fall of the American economy, 1910-29
A number of financial experts warned that the American economy was slowing down and in September 1929 some investors started selling shares [Shares: Financial stakes in a company or business. ] in large numbers. Many people started feeling nervous and investors went into panic and rushed to sell their shares. On 24 October, now referred to as Black Thursday [Black Thursday: It was called a 'black' day to show how bad the effect of selling shares that day was. ], 12.8 million shares were sold. Thousands of people saw their fortune, or any money they had in the bank, disappear. On 29 October 1929, 16 million shares were sold at very low prices. The Stock Market [The Stock Market: A centre where shares are bought and sold. ] New York in had collapsed.
The Roaring Twenties came to a sudden end. Investors lost their money in the Crash and could not pay their debts. Many banks closed, ordinary people lost their savings and people lost all hope for the future. People could no longer buy consumer goods like cars and clothes. As a result, workers were made redundant, other workers' wages was cut and unemployment rose to very high levels. This was the start of The Great Depression [Great Depression: A downturn in the economy for a lengthy period. This usually means the value of goods and their prices falling, unemployment, less investment, lack of credit and bankruptcies. The Wall Street Crash led to a global depression. ] of the 1930s.
Boom and bust (PDF file 193 kb)
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