It's October 29, 1929. Looking out of windows, the sight of plummeting lives quickly transitioned from unheard of to common. Many people have caught word of the stock market crashing, known as Black Tuesday, and just could not handle the turmoil. Instead, they chose the quickest escape from reality; death. The stock market crashing changed the lives of Americans, and forever reformed the era of America as we once knew it.
The majority of Americans believed that there was one, sole cause to the Great Depression. They believed that the stock market crash of 1929 was the only reason for the dilemma cause; this is no where near the truth. In fact, there were a myriad of events leading up to the dark climax of the Great Depression (Grant 8). There were some possible illegal and/or fraud involved, but none of these allegations were proved true. Many public officials did not know how to handle the situation of the crash, so they pointed fingers. Some, including President Hoover, stated that the stock market's prices were too high. A great number of public officials insisted that the stocks were 'over valued' and that 'speculation hurt the economy.' These statements were said as a means to calm the growing anxiety of the people, but the amount of concerned and worried Americans were too high to be calmed (Stock Break 2).
Perhaps the most common scapegoat for causing the Crash of '29 is the speculation that the stocks were overpriced. In truth, the prices were fine. Studies argued, using standard measures of stock value, that share prices were not too expensive, if at all. This topic remained a priority over many others, and soon the speculation was proven false. The prices remained under observation, until a second scapegoat shed its light upon the researchers: margin buying. Margin buying is a risky technique involving the purchase of securities with borrowed money, using the shares themselves as security. However, later studies proved that margin buying did have a small cause, but not large enough to impact the total value. Margin buying only took up less than 5% of the total stock value (Stock Break 1).
Between the years of 1932 and 1943, prices of merchandise fluctuated inconsistently. To buy a new Pontiac Coupe, one would have paid $585.00; the same price for a woman's Mink Coat. A new Packard would cost $2,150.00, and because of these heightened prices, many chose to buy used automobiles. The cheapest used vehicle was a Ford '29, for $57.00. Buying food wasn't too expensive, until a family ran out of stocks. By the pound, Sirloin Steak cost $.29, Round Steak $.26, Rib Roast and Bacon, $.22, and Ham was $.31. Some families would buy stocks of these products for their family two nights a week. A family of four could spend $10.40 a week just for meat. Added with the prices of seasoning, and the mere buck or two a day, saying times were rough would be like stating the obvious (Hard Times 29).
The Federal Reserve Board's new president, Adolph Mille, strengthened the financial policy and strived to lower stock prices, since he believed the crash caused prices to be overly expensive. His 'policy reduced the amount of broker loans that originated from banks and lowered the liquidity of non-financial and other corporations that financed brokers and dealers' (Stock Break 2). Thanks for the Federal Reserve Policy, the stock market was renewed to its normal, if not better, state of being (Stock Break 1).
"The worst is over without a doubt," according to James J. Davis, Secretary of Labor (The Simple Truth 3). In a sense, this is true, because while there were less people willing to throw their lives away, the devastation caused by the Great Depression would still be under repair. This predicament nudged America into an uprising of turmoil. Fortunately, the entirety of the situation could not prohibit America from reuniting as an improved country. From the hardships of trying to feed one's family, to the country suffering in the sun's shadowy rays of poverty, America had escaped the Depression with a broad grin inched across her face. America had finally prevailed over the mayhem and began a new era.




Works Cited

Grant, R.G. 'The Great Depression'. Great Britain: Hodder Wayland, 2002.

'Hard Times, the 30's.'Alexandria, VA: Time Life Books, 1998.

Schmidt , Ricky. 'Stock Breakthrough.' September 2008. 10 May, 2003.

http://www.stockbreakthroughs.com/articles/1929-stock-marketcrash.htm.

Wood, Tim. 'The 4-Year Cycle.' 26 September, 2008. 10 March, 2007
http://www.doublestandards.org/depression1.html.
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