What factors were responsible for the Wall Street crash?

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Daniel Edwards

What factors were responsible for the Wall Street crash?

In my view there are six main factors which led to the Wall Street crash. In no particular order and A) poor distribution of income between rich and poor, B) over production by American industry, C) actions of a speculators, D) no export market for US goods, E) decision by banks not to support share prices and F) Laissez Faire (not interfering with Industry and personal wealth). The clash came after a long period of high share prices and high sales of consumer goods in the early 1920s. Some causes above had been considered to have caused the crash more than others in the past but what is certain is that the crash would not have happened if all causes were not there.

The first cause is that I will go into detail about is a poor distribution of income between rich and poor. I'm starting with this because it is the first on the list. In America the government dint tax people call into personal wealth (Laissez Faire), that meant that the rich got richer and the poor got poorer because the rich invest in shares for example and received money that way and become richer where as the poor had to use most if not all to support their families so they weren't getting richer, if you add that to the fact that with the rich buying more consumer goods the prices of the before mentioned goods would have increased making it even less likely that the poor could afford them without making them poorer. This meant that the gap between the two sets of people increased so when it came to buying consumer goods the rich bought all when needed, like electrical goods and cars but in the 1920s a goods were built for life and the goods didn't have a built-in obsolescence like the goods built today.

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The poor including farmers, many whites and the majority of the black people could not afford to buy the goods, they could hardy afford to feed themselves and their family which meant that many didn't eat everyday of the week. With the government not being prepared to do anything about the situation, the problem would continue until something was done about the personnel wealth of Americans and the industries that they work for. Over 50 per cent of America's population didn't share in the boom; this percentage is too high to sustain such economic growth as this.

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