2006-06-28 02:02:48 · 10 answers · asked by Denise M 1 in Business & Finance ➔ Other - Business & Finance
No. Currently the fed fears that the ecomony is growing too fast. That is why the interest rates keep going up. I don't think we'll see a depression like in the thirty's because there were laws passed to prevent it.
In 1929, before the era of the Securities and Exchange Commission (SEC), stocks were bought on margin. Margin allows you to buy much more stock while only putting down pennies on the dollar of the value. The problem with margin is that if the stock goes down in value a margin call is required and people must pay in more money to cover the decline.
The crash of 1929 was caused by people not being able to cover the margin calls and defaulting. Obviously this wasn't the sole factor just the biggest.
The federal securities and exchange act created the SEC and made trading on margin much more restricted to insure against a mass default in the future.
2006-06-28 02:16:04 · answer #1 · answered by Thrasher 5 · 0⤊ 2⤋
The depression in the 30's was a result of all the money being in to few hands. Rummer and fear caused all people to believe that they could not trust the banking industry.
When it first became known that banks were beginning to default people felt like they had to go get there money while they still could. That became wide spread and soon guaranteed the collapse of the banking industry. Long lines at the bank of people pulling their money out soon forced the banks to close.
In theory there have been checks put in place to not allow that to happen again. But a lot of things that occurred prior to the collapse are occurring today. This by no means says it will happen again.
The economy has been up and down many times sense then but has never collapsed. That has not been an accident.
People who lost everything back then never trusted the banks again. However many of the very rich today became that way because they knew how to work the system back then.
At the moment there are many other things to worry about besides this. Our biggest threat comes from outside...in many forms. How we work together....and pay attention to what our government is doing....will determine our long term survival.
2006-06-28 10:55:24 · answer #2 · answered by John B 5 · 0⤊ 0⤋
If you live in Michigan you do. We have the highest unemployment rate in the country. Yes, our unemployment rate is even higher than Alaska. We are a state that was built on Manufacturing and with all of the outsourcing going on we are loosing our shirts, not to mention our shoes, houses and cars.
2006-06-28 09:12:18 · answer #3 · answered by Karen M F 1 · 0⤊ 0⤋
Yes,
But in a slower way. The processes have already started. Save precious metals as they may be the only things which may be used to buy food, as the American Dollar would be worth very little.
2006-06-28 09:09:11 · answer #4 · answered by sport 1 · 0⤊ 0⤋
I hope we're heading for another 60's. War protests, immense drug consumption, loitering on public grounds, no haircuts, etc, etc.
2006-06-28 09:07:27 · answer #5 · answered by jaike 5 · 1⤊ 0⤋
Didn't you read? The economy is booming!
2006-06-28 09:06:18 · answer #6 · answered by Dr. Rob 3 · 0⤊ 0⤋
nope
2006-06-28 09:05:08 · answer #7 · answered by Homer J. Simpson 6 · 0⤊ 0⤋
WHY TO BOTHER MY HEAD WITHOUT ANY REASON?
2006-06-28 09:27:51 · answer #8 · answered by Anonymous · 0⤊ 1⤋
YES! Big time..
2006-06-28 09:06:21 · answer #9 · answered by Blend 2 · 0⤊ 0⤋
really! I better go take my meds, thanks.
2006-06-28 09:08:26 · answer #10 · answered by mike67333 6 · 1⤊ 0⤋