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Questions and Answers
What event is considered the trigger for the Great Depression?
What event is considered the trigger for the Great Depression?
- Increase in foreign trade
- Federal investments in infrastructure
- Rise of consumer credit
- Over-speculation in the stock market (correct)
Which factor contributed to the unsustainable growth in the stock market during the Roaring Twenties?
Which factor contributed to the unsustainable growth in the stock market during the Roaring Twenties?
- Increased foreign investment
- Lack of federal regulation in corporate expansion (correct)
- Rise in agricultural production
- Decreased consumer spending
What was a significant barrier to rebuilding investor confidence after the market crash?
What was a significant barrier to rebuilding investor confidence after the market crash?
- Absence of a safety net (correct)
- Fall in international exports
- Lack of government intervention
- High interest rates on loans
When did federal interventions lead to the first growth of the stock market during the Great Depression?
When did federal interventions lead to the first growth of the stock market during the Great Depression?
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What ultimately contributed to the end of the Great Depression?
What ultimately contributed to the end of the Great Depression?
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Study Notes
Wall Street Crash of 1929
- Triggered by over-speculation in the U.S. stock market, marking the onset of the Great Depression.
- The Roaring Twenties saw unprecedented investment, with many investors borrowing funds to purchase stocks.
- The stock market experienced considerable growth, plateauing in the summer of 1929 before crashing in October.
- The crash followed eight years of continuous economic expansion characterized by rampant speculation.
Contributing Factors
- Federal disregard for corporate growth created a volatile investment environment.
- Banks heavily invested in the stock market, exacerbating the market's instability.
- Lack of protective regulations contributed to a significant loss of confidence when the market faltered.
Aftermath and Recovery
- The economic fallout severely impacted the working class, with lasting effects throughout the 1930s.
- Federal interventions in 1933, including new policies and regulations, reinstated investor confidence.
- This renewed confidence led to the first signs of stock market growth during the Great Depression.
End of the Great Depression
- The economic decline concluded as the American economy shifted to support military efforts during World War II.
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