Stock prices rose in 1929 primarily due to many investors buying stocks on margin. This practice allowed individuals to borrow money to purchase more shares than they could afford outright, leading to a speculative bubble in the stock market. The optimism of the time and the potential for high returns encouraged more people to invest, driving prices up significantly. However, this also contributed to the volatility and eventual crash of the stock market later that same year.
Why did stock prices rise in 1929?
Banks were giving out fewer loans.
Goods were getting expensive.
People were giving collateral to companies.
Many investors were buying stocks on margin.
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