USA KQ5

Question 1

Wall Street Crash

Answer 1

In October 1929 the American stock market on Wall Street crashed due to long term problems with the US economy
Banks went bankrupt and it sped up the arrival of a depression and the Great Depression

Question 2

Overproduction

Answer 2

By the end of the 20s many consumer goods were left unsold
50% of American families earn under $2000 per year
Technology led to an increase in produced crops and Europe could grow their own so it hurt farmers

Question 3

Property prices

Answer 3

In 1926, prices fell so people panicked and sold for less than they cost. Florida is an example of where this happened
This led to prices falling further as many houses were up for sale

Question 4

Small banks

Answer 4

After the war many small banks were formed
No questions were asked if people wanted to use credit so everyone did it
They couldn’t cope when everyone couldn’t repay them after the crash so they had to shut down

Question 5

Over-speculation

Answer 5

In the 1920s everyone bought shares “from the shoe shine boy to the president”
People started to buy shares without doing research as prices were rising
In 1928 they weren’t rising as much so people began to sell
By the beginning of 1929 prices were rising again so people started speculating but this time it was too much

Question 6

Availability of easy credit

Answer 6

Hire purchase from companies such as ford allowed people to pay in instalments but didn’t fully own the product
“Buying on the margin” was where you bought shares on credit
When priced started to fall, people couldn’t repay it so many small banks had to close

Question 7

Loss in share confidence

Answer 7

Autumn 1929- financial experts started to predict that companies wouldn’t do well
They started to sell their shares
Other experts panicked followed by small investors
As many shares were unsold, the price falls dramatically

Question 8

19th-23rd October 1929

Answer 8

19th: 3.5 million shares bought or sold prices begin to fall
20th: prices massively fluctuated as 6 million shares were bought or sold
22nd: the stock market recovered
23rd: over 2.5 million shares were sold in the last hour alone

Question 9

24th-29th October 1929

Answer 9

24th: “Black Thursday” prices fell massively as 13 million shares were sold, people rushed to sell
25th: bankers met at midday and steadied the prices by buying shares themselves
26th: Hoover speaks and tells America that the panic is over and they will recover
28th : 3 million sold in the last hour
29th: “Black Tuesday” the worst day in the history of the stock market, 16.5 million shares sold, they lost all valJe

Question 10

Consequences (1-3)

Answer 10

Alistair Cooke, a British journalist, reported on how well-dressed men were out on the streets asking for night work
Farmers were hit, they carried placards saying “in Hoover we trusted now we are busted”
Thousands of men hitched rides on railcars and freight wagons

Question 11

Consequences (4-6)

Answer 11

The bank weren’t able on pay people back when it went wrong as people didn’t repay credit
Rockefeller lost $160 million, aspiring British politician Churchill loses 500,000
Shares in a cigar company fell from $115 to $2 in the crash and the owner jumped out of his window