The Stock Market Crash The Stock Market Crash of 1929of 1929

By: Hatka ProzoracBy: Hatka Prozorac

Mirela MemicMirela Memic

Harjit KaurHarjit Kaur

The Roaring 20’sThe Roaring 20’s People began buying everything from People began buying everything from

houses to cars to appliances. houses to cars to appliances. Assembly lines increase production. Assembly lines increase production. Credit cards were issued to wealthier Credit cards were issued to wealthier

customers.customers. Banks provide installment loans, Banks provide installment loans,

mortgages, and loans to stock market mortgages, and loans to stock market speculators.speculators.

The First National City Bank begins The First National City Bank begins selling stock and has over 2,000 selling stock and has over 2,000 brokers selling stocks.brokers selling stocks.

The First National City Bank also The First National City Bank also created compound-interest savings created compound-interest savings accounts and mutual funds.accounts and mutual funds.

The McFadden Act of 1927The McFadden Act of 1927

This Act:This Act:1.1. Established the Federal Reserve Board Established the Federal Reserve Board

as a permanent central bankas a permanent central bank2.2. Prohibits interstate bankingProhibits interstate banking3.3. Authorizes hometown branches fro Authorizes hometown branches fro

national banks, which helps put national national banks, which helps put national banks above state banks.banks above state banks.

4.4. Allows national banks to have authority Allows national banks to have authority to buy and see debt obligations.to buy and see debt obligations.

During 1929During 1929

17,583 state banks 17,583 state banks closed closed

8,150 national banks 8,150 national banks closedclosed

Black Tuesday: October 29, 1929Black Tuesday: October 29, 1929

The Stock Market Crash The Stock Market Crash of 1929 marked the of 1929 marked the beginning of the Great beginning of the Great Depression.Depression.

The Federal Reserve The Federal Reserve limits money, and the limits money, and the publics confidence in the publics confidence in the government and business government and business declined drastically.declined drastically.

A record-breaking 13 A record-breaking 13 million shares are traded, million shares are traded, indicating panic.indicating panic.

Timeline of Important DatesTimeline of Important Dates

August 24, 1921: The August 24, 1921: The Dow begins its post-Dow begins its post-war boom at 63.90 war boom at 63.90 points. points.

August 22, 1922: The August 22, 1922: The Dow tops 100 for the Dow tops 100 for the first time, closing the first time, closing the day at 100.75. day at 100.75.

Between 1922 and Between 1922 and 1929, the Dow rises 1929, the Dow rises 400 percent. 400 percent.

Important dates continuedImportant dates continued

September 3, 1929: The Dow hits its pre-crash September 3, 1929: The Dow hits its pre-crash high, closing at 381.17. high, closing at 381.17.

October 24, 1929 (Black Thursday): The crash October 24, 1929 (Black Thursday): The crash begins. A record-breaking 13 million shares are begins. A record-breaking 13 million shares are traded, indicating panic. That afternoon, 5 banks traded, indicating panic. That afternoon, 5 banks pony up about $20 million each to buy stock and pony up about $20 million each to buy stock and restore confidence in the market. It seems to restore confidence in the market. It seems to work. There's a late rally, and the Dow closes at work. There's a late rally, and the Dow closes at 299.47.299.47.

October 25, 1929: The rally continues, and the October 25, 1929: The rally continues, and the Dow closes at 301.22 Dow closes at 301.22

Important dates continuedImportant dates continued October 28, 1929 (Black Monday): The rally October 28, 1929 (Black Monday): The rally

ends. Panic selling resumes. The Dow drops ends. Panic selling resumes. The Dow drops almost 40 points (nearly 13 percent) to close almost 40 points (nearly 13 percent) to close 260.64. 260.64.

October 29, 1929 (Black Tuesday): The Dow October 29, 1929 (Black Tuesday): The Dow drops another 30 points (nearly 12 percent) to drops another 30 points (nearly 12 percent) to close at 230.07 on trading of 16 million shares. close at 230.07 on trading of 16 million shares.

July 8, 1932: The Dow closes at 41.22, an 89 July 8, 1932: The Dow closes at 41.22, an 89 percent drop from its pre-crash high. percent drop from its pre-crash high.

November 23, 1954: 25 years after the crash, November 23, 1954: 25 years after the crash, the Dow reaches its pre-crash high again, the Dow reaches its pre-crash high again, closing at 382.74. closing at 382.74.

CreditsCredits

http://www.fdic.gov/about/learn/learning/whttp://www.fdic.gov/about/learn/learning/when/1920s.htmlhen/1920s.html

http://affordablehousinginstitute.org/http://affordablehousinginstitute.org/blogs/us/2005/11/catastrophe_is.htmlblogs/us/2005/11/catastrophe_is.html