What caused the stock market mania in the 1920s?
It was the government’s lack of interest in the gold-dollar matter of the 1920s, a symptom of which was the sustained increase in prices, that caused the stock-market mania to begin with.
What did the American people buy in the 1920s?
The American people bought stocks in unprecedented fashion. Stocks on the installment plan, stocks via investment clubs, stocks bought with capital rather than income, stocks on margin. It was a big new fad. Nothing like the participation in the market that the nation experienced in the 1920s can be found in previous eras of history.
What was the reality of the 1920s?
These realities gave no spur to stock-market participation. The permanent denuding of the dollar, the reality of which first became clear in the 1920s, forced savers to find some instrument that would pay them back in the old way, in money that held its value.
What was the big switch in the 1920s?
The big switch, in the 1920s, from the perspective of the average person’s financial position, is what occurred with respect to the long-term value of savings. Never before in American history had there been multi-decade evidence that the dollar was not holding its value.
What was the American economy during the Industrial Revolution?
It was the paragon of global growth during the central years of the industrial revolution. The American economy became the largest in the world, and then some, beginning in the 1880s, having been quite literally a backwater not many decades before. Before the 1920s, in other words, people, as they acquired resources by dint ...
What was the inflation rate in the 1920s?
In the 1920s, however, the inflated price level remained sticky, holding at that 170% level.
When did stocks crash?
Stocks crashed horribly, to be sure, 1929-33, but there was no savings strategy to avert it, outside of stuffing cash in the mattress, and good luck with policing that in desperate days. Banked money bit the dust, gold-owning was outlawed, and bonds got killed too.