In 3–5 sentences, explain 2 causes and 2 effects of the stock market crash of 1929
Two causes of the stock market crash of 1929 were the excessive speculation in the stock market and the use of margin buying, which allowed investors to purchase stocks with borrowed money. These practices led to an unsustainable increase in stock prices and created a bubble in the market.
Two effects of the stock market crash were the widespread panic and loss of confidence in the market, which caused a massive decline in stock prices and a wave of bankruptcies. This led to a severe economic downturn known as the Great Depression, which lasted for over a decade and resulted in high unemployment rates and a significant decrease in consumer spending.