What were the warning signs that the economy was in for serious trouble?
2007-12-12 07:58:15 · 3 answers · asked by Johnny Carson 2 in Arts & Humanities ➔ History
The Stock Market Crash was caused by a sick economy. The Dust Bowl was part of a much bigger crash in agriculture. Farmers were suffering throughout the 20's due to both lower yields and lower prices. Since most of the population lived on farms, it was a matter of time before they stopped buying manufactured goods. Following that, the banks and service industries faltered. Wall Street was an unregulated mess but the underlying problem was low profits and a shrinking economy.
Foreign trade was also depressed because Europe never recovered from World War I and their farmers were also suffering from poor soil conservation and drought.
There was almost no military spending creating jobs or a market for manufacturing either.
2007-12-12 08:34:42 · answer #1 · answered by Menehune 7 · 0⤊ 0⤋
Banks being able to buy & sell stocks like they were gambling. Then the "Glass Steagel Act" was implemented to avoid this in the future; ah, Billy B-Job banished the Glass Steagel Act during his presidency.
2007-12-12 08:04:37 · answer #2 · answered by Giggly Giraffe 7 · 0⤊ 0⤋
the ability to buy things on credit or the installment plan
people were buying things that were expensive and were able to pay it off in a few years or months
also buying stock on margen
people bought stock with money they didnt have and wen the stock went donw they were in trouble
2007-12-12 08:04:59 · answer #3 · answered by Anonymous · 0⤊ 0⤋