Stock Market Crash Essay

817 Words2 Pages

Americans to this day still remember the Great Depression of 1929. It was a horrific time for all of America. Following the stock market crash on Wall Street, millions were laid off, almost half of the banks failed, and people committed suicide. Currently, the U.S. stock market is better than it has ever been, with no fear of another crash, stock prices continue to rise. However, a rapid increase in American stock prices will result in an unrecoverable stock market crash and utter chaos. The scary part of a stock market crash is that no one, not even the experts on Wall Street, can predict when it will happen. The signs leading up to a crash are almost impossible to see until it actually happens. When it does, the U.S. will experience the worst economic collapse …show more content…

Businesses will close, people will lose jobs, banks will shut down, and billions of dollars will be lost, and people will behave like animals due to no social order.
A rapid increase in stock prices is the origin of a stock market collapse. When stock prices swiftly rise, the U.S. dollar is overvalued. Investors are more confident as stock prices continue to rise and are more apt to do whatever to get more shares. This act of desperately buying more shares proved to be catastrophic in 1929 right before the Great Depression. According to Pettinger (2017), “In the years leading up to 1929, the stock market offered the potential for making huge gains in wealth. Prices were not being driven by economic fundamentals but the optimism/exuberance of investors” (para. 4). This proves that the stock prices were not exactly worth what was being advertised and suggests that when stock

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