How far do you agree with the view that the Wall Street crash was responsible for the depression of the early 1930s?
The Wall Street Crash had occurred in 1929 and is regarded as being the most devastating stock market crash to have ever occurred within the history of the United Sates. The crash was caused due to a wide range of factors, which became uncontrollable during the 1920s when America was experiencing a period of “boom” and many were benefiting from the flourishing prosperity. The events of the Wall Street Crash signalled the start of the 12-year Great Depression, which had an affect not only upon the United States, but also the Western Industrialised countries, with having a rapid spread worldwide. The Wall Street Crash triggered the beginning of a decade of high unemployment, poverty, low profits, deflation, plunging farm incomes and the lost opportunities for economic growth and any personal advancement with a lack of confidence being placed on the future of the economy.
In conclusion, even though it could be argued that the Wall Street Crash was the main reason, which had led to the Great Depression, which the USA suffered for 12 years, it is important to know that there are other factors which contributed towards the great Depression and made the situation for America uneasy. I believe that the main contributing factor, which was responsible for the Great Depression, is the Bull Market itself and the acts of Speculation. The Bull Market is considered as being a risky investment because once you invest, the stock exchange prices could either flourish which would be beneficial, or there is a risk of the stock exchange prices for your investment to fail. However with the apparent prosperity and Boom in the 1920s, risks of the Bull Market were invisible, and success was sought to be the outcome of each investment. There was a frenzy of unregulated speculation that had impacted on the stock market idea, with the stock prices far outrunning economic growth itself that had fallen.