Explain in 3 sentences 2 causes and 2 effects of the stock market crash of 1929

Answer 1

Two significant causes of the stock market crash of 1929 were rampant speculation in the stock market and excessive use of margin buying, where investors borrowed money to purchase stocks. The crash led to severe effects, including widespread bank failures as financial institutions struggled to cope with the losses, and the onset of the Great Depression, which resulted in massive unemployment and economic decline. These events fundamentally altered the American economy and prompted the implementation of regulatory reforms aimed at preventing future market instability.