The Stock Market Crash
The stock market is very much like legalized gambling. Anybody can place bets by buying and selling stocks. In the stock market the goal is to buy a stock at the lowest price possible and when it is at its highest price possible,to sell it. Stock is purchased and sold through stockbrokers who in turn tell individuals on the stock market floor to buy or sell a stock, much like an auction. When stocks are being bought more than they are being sold, their prices go up, and when a majority of stocks are in an upward trend it is called a bull market. Vice versa, when the majority of stocks are in a downward trend it is called a bear market. In 1929 there had been a bull market for some time, and it seemed like it would never stop. In October of that year, the market came to an abrupt halt. The market didn't crash for just one reason either, in fact there were quite a few. The first reason that had helped contribute to the stock market crash of 1929 was the mass marketing of stocks and bonds. The stocks and bonds were being open to anybody, big or small. For the first time, anyone could invest in the stock market. Since everyone was now investing, a bull market, which is an upward trend in stock prices, was created. Every
Since the greed of the speculators for money was so strong, they were buying stock "on margin" to try and make quicker and larger profits. In short, this meant that they were purchasing stocks with other peoples' money. All that the investors had to do was put down 10 percent of their money to buy the stocks. This would work if their stock went up, but if the stock that they had purchased had gone down they would be in great debt. The speculators would have no way to pay off their loans, and wouldn't have any hope. The most important reason for the crash was the fear and greed that was within the people of the period. Everyone had put his or her money into the market in hope of making some back. These people were happy when they first started to make some minimal gains. Soon that happiness would fade away, and the people would want to make just a little more. They would make that little bit and be satisfied for a short period of time. This process would go around in circles and the people would just want more and more. They were never satisfied. To keep making their money, the investors would be extremely nervous and on edge about the companies that they had invested in. At any little sign of trouble the people would panic and sell, driving the price of their stock way down. This course of action would also act inversely. If there was a hint of a stock rising, everyone and their uncle would be buying it. This would completely inflate the price of the stock, and it wouldn't be worth nearly
Some common words found in the essay are:
, stock market, bull market, money investors, sell stock, price stock, stocks bonds, stocks bought sold, bought sold, crash 1929, trend called, majority stocks,
Approximate Word count = 1021
Approximate Pages = 4 (250 words per page double spaced)
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