history notes - History Notes chapter 24 The speculative...

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History Notes 03/05/08 chapter 24 The speculative Frenzy “Everyone ought to be rich” $15 a month in common stocks would leads to 800,000 20 years Don’t believe hype! Less than Margin buying; 10% down What is the problem w/ banks, corporation speculating in the stock market? They are at greater risk of failure Don’t invest money in productive areas like Increase wages Benefits for workers are low Research and development Loans for new business New equipment Another wrinkle: corp. speculated in an unstable stock market Also, lent money for margin buying Standard oil of NJ $69 million a day Electric bond and share over 100 million day An inherently unstable situation The crash begins Wednesday, October 23 rd Sox million traded 4 billion in paper value disappears Ticker falls behinds by two hours panic selling Black Tuesday October 24 th Opens with a landslide of sell order More panic 13 million shares trades Losses recovery 9 billion by noon Small recovery brought it to 1.4 billion for the day Ticker ran four behind Educational level was different today than then Black Tuesday October 29 th the crash Over 16 million shares traded This records lands for another 39 years By mid Nov. 1/3 of the stock market value, approx. 26 billion had vanished Does this cause the great depression? By April 1930 stock market had recovered by about 20% What are other factors contributing to the great depression? 03/07/08
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03/17/08 What are other factors contributing to the Great Depression? Versailles and reparations A triangle Loans to Germany Reparations to England and France Payment of debts to US Germany’s Great depression 1914-4 marks to other dollar 1923-4 billion marks to the dollars Borrow money from US; Germany Germany stops making payments to England and France and as depression worsens they stop making payments to Us backs Still, a GD was not inevitable Hawley Tariff of 1930 Very bad leg. 1,000 economist peition not to sign the bill HH president Worsens the GD worldwide World trade decline from $26 billion in 1929 to approx. $12 billion in 1932 Protected tariff imported good higher than American Failure of leadership on the part of president HH Banks failures
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history notes - History Notes chapter 24 The speculative...

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