The Great Depression began with the catastrophic fall of the stock market on Oct. 29, 1929. This day is known as "black Tuesday." What does this information lead you to conclude about the importance of the stock market to the American economy?

Question

Social Studies

Chloe Roman

7 February, 05:19

The Great Depression began with the catastrophic fall of the stock market on Oct. 29, 1929. This day is known as "black Tuesday." What does this information lead you to conclude about the importance of the stock market to the American economy?

+3

Answers (1)

Know the Answer?

Destinee Knapp · Answer 1

Stock market is a very significant determiner of American economy.

Explanation:

The fall of stock market on 29 October, 1929 played a massive role in emergence of the Great Depression. On this particular day, also known as Black Tuesday, investors traded 16 million shares as share prices completely collapsed in the New York Stock Exchange. This sudden trade in a single day led to the loss of huge sums of money and removed thousands of investors from the Wall Street. As a result, the economy started to collapse as businessmen and companies could no longer generate income and employment due to lack of investments. Prices of goods plummeted, unemployment increased and fall of banks eventually followed one after the other. It shows that stock market is a very significant determiner of American economy. With the fall of the stock market to almost 20% of its original value, the American economy started to collapse too. Thus, gradually attributing to the Great Depression of 1930s.