There were several factors that contributed to the stock market crash of 1929, but some of the main ones include:
1. Speculation: Many investors were speculating in the stock market, buying stocks on margin (borrowed money) in the hopes of making a quick profit. This led to inflated stock prices and an eventual market collapse.
2. Overvaluation: Stock prices were much higher than the companies' actual earnings and assets justified, creating a bubble that eventually burst.
3. Economic conditions: The economy was already weakening in the late 1920s, with a downturn in agriculture and stagnating industrial production. The Great Depression exacerbated these issues, leading to the stock market crash.
4. Bank failures: Many banks had invested heavily in the stock market, and when the market crashed, these banks suffered significant losses. This led to a wave of bank failures, further exacerbating the economic downturn.
Overall, a combination of these factors contributed to the stock market crash of 1929, leading to the Great Depression.
which of the following most contributed to the stock market crash in 1929
1 answer