History GCSE Depth Study USA

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Wall Street Crash
- Causes
  - Speculation
    - People bought shares and sold them again when the price went up.
  - Overproduction
    - Because of the huge gap between the rich and poor, demand for goods decreased as the rich already had them and the poor couldn't afford them.
  - Lack of Export Market
    - European countries were also experiencing financial difficulties so export sales wouldn't have been possible anyways.
    - Previously, Americans could've exported surplus goods.
      - However due to the Fordney-McCumber Act of 1920, European countries also retaliated with their own tariffs.
  - Banks
    - Banks lent out lot of money for speculation.
  - Loans
    - Americans had previously loaned a lot of money to Europe but when the stock market collapsed they suddenly recalled these loans.
- Effects
  - By 1933 over a quarter of the workforce was unemployed.
  - Many people moved around for work.
  - Most people lost their jobs as companies couldn't afford to keep them
  - From 1929 to 1930 around 700 banks had closed.
  - Ordinary people lost their life savings.
  - Killed confidence of the people.
Overproduction
- Because of the huge gap between the rich and poor, demand for goods decreased as the rich already had them and the poor couldn't afford them.

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