The Great Crash
By: Krista Salvas and April Rugan

Time Line

• March 26 - New York stocks big drop. Exchange sets record of 8.2 million shares traded.
• April 1 - Stocks drop again
• September 3 - Issues with Wall Street reached an all-time high. Some stocks tripled in price from the year before.
• October 3-14 - Dow drops
• October 21- Margin calls were heavy over night to sell stocks
• October 22- Corporations called in $150 million call loans
  October 24 - People started selling their stocks as fast as they could. The U.S. stock market started its crash on "Black Thursday," with 13 million shares sold.
• October 29 - "Black Tuesday," the market bottoms out, with 16 million shares sold. A few days of apparent recovery follow, with a slight rebound in prices, but the market drops again
• November 13 - prices reach their lowest point for the year and $30 billion in stock values are wiped out. The crash, combined with other negative factors in the U.S. and world economies, very decisively brings to an end the decade of the 1920s and hastens the Great Depression.

"Black Tuesday"

The 1920s were a booming decade for the people. Many inventions were made making the standard of living better for even the poor. More jobs were created for the people when the automobile was invented. This made the unemployment rate low and made the future look bright; at least that was what the people had thought. Throughout the 1920s, the long boom took stock prices to peaks never before seen. From 1920 to 1929 stocks more than quadrupled in value. This made the people want to invest to make more money. Wealthy Americans were not the only people to invest in the stock market, either. This event involved all people, big and small, rich and poor, young and old. Many people who could not even afford to gamble bought stocks anyway. The people thought that investing was an easy way to make money in the rising market. They sometimes bought those stocks with borrowed money, such as loans, because they had so much confidence in the market. Rapid buying and selling inflated the prices of many stocks to the point that many were selling for more than they were actually worth. Herbert Hoover once stated to the public that the stocks were overvalued and that speculation was hurting the economy. Hoover was right because what people though was an easy way to make money would soon come to an end and shock the entire public.
About a week before the stock market crash, many frantic calls were coming in from other countries causing a lot of worries. The calls were talking about how prices would decrease and cause another crash. Five days before the actual crash, (known as “Black Tuesday” or the “Big Crash”) there was a major sell-off of stocks due those falling prices. As the prices continued to fall, panic struck causing even more calls to pour in to sell stocks. The brokers demanded cash to cover their loans and when the investors couldn't come up with the extra money, they had to sell their stocks leaving them at a loss of money. The dumping of so many stocks on the market jolted investors’ confidence and caused prices to plunge. The plunge in those prices was wiping out the savings of millions of Americans who had invested in the stocks. The Dow had lost over 500 points making the stock market finally crash on October 29, 1929. Prices sank to a shocking new low as investors dumped over $16 million shares of stock on the market leaving shareholders at a loss of some $30 billion. Then by November 13th, the prices had hit rock bottom. With all of this money loss and panic, it was sure to cause more problems for the people in the future that was soon to come.
After the Stock market fell the Great Depression began to creep up on the United States. The unemployment rates began to increase significantly and wages began to decline due to industrial production. Millions of workers lost their jobs because companies shut down. Poverty was spread wide around the U.S. and many industries only produce small amounts compared to their capacity. Even banks began to call in loans; this was the worst economic depression ever. The day the market fell is the day the depression came affecting everything and everyone.