Black Tuesday
- Dow Jones Industrial average collapsed
- Continued selloff took place until 1932 when the DJIA was 89% of it 1929 peak
- People threw themselves out of buildings
- Businesses go bankrupt
- Banks close- difference between now and 1929- when everything shut down, the banks went bankrupt too- now when bank goes bankrupt people are insured by the federal government
- Depression begins
- Its called Black Tuesday because it was the largest drop to happen in one day
- although this is a one day event it triggers stuff. The stock market continued to drop over the next 3 years
Causes of Black Tuesday
- Overproduction lowers prices
- "Farmers have always been poor"
- First sign of the coming depression
USA 1920's Extra Points
- High Tariffs: Success for the US businesses, part of isolation policy
- Laissez faire capitalism: Private ownership with little infringement from the government (Hoover's recession and stock market crash)
- Overproduction a major cause for both agricultural recession and stock market crash
- Government restriction on immigration, particularly Asians during this period.