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crash's coming

Causes Of The Wall Street Crash

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This is from BBC GCSE bitesize. Anyone who studied GCSE in history should know this. Don't you guys think the reasons linked to...... the Wall Street Crash is extremely similar to the current housing market situation?


Reasons linked to money and the stock market that led to the Wall Street Crash:

  • People were allowed to borrow too much money and they could not afford to pay it back.
  • People had taken out loans or invested their savings in the stock market, but there were too few controls on the buying and selling of shares.
  • The US President had not taken any notice of what was going on; he just left the businesses and banks to themselves.
  • Advertising and hire purchase agreements were not controlled, and this encouraged people to spend more.
  • Too many people thought that share prices could only go up, which encouraged them to invest more than they could afford in the stock market.
  • Banks did not have enough money in reserve to help businesses that were in trouble. This was because they had lent too much money but now the banks were facing difficulties because people could not afford to repay their loans.
Edited by crash's coming

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