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The Stock Market During The 1920's

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"After 1929, so many people had been traumatized by the stock market crash that there was a lost generation." These wise words were said by Ron Chernow, American writer and historian. On October 29, 1929 thousand of people waited outside banks in hopes to take out their savings and sell their stocks. During the 1920's, people lived in prosperity, and all was well but soon after that the Great Depression hit. During the great depression, millions of people lost their jobs. Factories were shut down because of overproduction, and banks were forced to close, leaving the American people with no money. As banks closed they started to create a chain reaction, which resulted in misery throughout the whole country.

President Franklin D. Roosevelt was the first to turn things around for the American people. Unlike the previous president, Herbert Hoover, Roosevelt would try different ways to help the American people. Furthermore, Roosevelt created programs that …show more content…

This organization was established June 1934, and it is still in effect today. The Securities and Exchange Commission's job is to regulate the stock market to avoid dishonest practices. Before this organization was created the stock market had no rules and anybody could play the market how they wanted to. During the 1920's, people would buy stocks on margin. Meaning, Americans only had to pay ten percent of what the stock was actually worth and pay the rest in small payments. However, the problem with buying on margin was that people would buy hundreds of stocks and later during margin call, they didn't have enough money to pay back. Furthermore, stock speculation also became a big thing. During the process of stock speculating Americans would play that stock market to get more money. This is one of the main reasons that the SEC was created. The SEC helps regulate the stock market, so it doesn't crash like on October 29,

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