In 1929, the economy of UNITED STATES is in good health. However, many Americans play on the stock market like one plays in a casino, they buy and sell at will to speculate. But in October of that same year, American production slows down and, at the same time, interest rates soar. The shareholders then start to sell their shares a lot…but there are no buyers!
In the space of one morning, stock prices plummeted to a record level… Never seen before! It’s the panic. In New York, riots break out and traders commit suicide by throwing themselves out of windows. Wall Street is on the verge of closing down but fortunately the banks are playing the role of firefighter and buying as many shares as possible to prevent un crash. At the end of the day on October 24, prices are recovering.
Everyone says that the nightmare is over and during the two days that follow, the New York Stock Exchange regains color. Except that the following week, stock prices plunged again and this time, the banks were absent. The values of big companies like General Electric et General Motors collapse. The stock index, the Dow Jones, is in free fall.
Millions of people on the streets overnight
In 3 weeks, Wall Street lost the equivalent of 30 billion dollars, which represents 10 times the budget the United States. Americans who bought stocks on credit therefore find themselves ruined because they can no longer repay the banks. The banks then go bankrupt and take with them the listed companies which go out of business. Everyone is dragged into the catastrophe: fall in investments, fall in production, fall in consumption, increase in unemployment and poverty… The entire American economy is collapsing like a house of cards. . Millions of people find themselves on the street overnight.
It is the economies of the entire planet that find themselves on their knees, where the United States has invested a lot of capital. This is leading to a global crisis. Everywhere, unemployment and poverty are exploding. Each country then adopts protectionist measures. The State is regaining control of the economy, but this is not enough given the scale of the disaster. The power of Wall Street Is at the origin of the worst economic crisis in history. We then speak of the ‘Great Depression’.
The consequences will be terrible. The rise of nationalist movements is felt, especially in countries in bad shape since the First World War. In Germany, it is Nazism who benefits from the collapse of the country. The more poverty and despair grew, the more Hitler gained points in the elections, until he finally took power. That Black Thursday on Wall Street in 1929 changed the history of humanity forever. This key date is also one of the causes of the Second World War…
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2023-10-24 08:47:00
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