The stock market was going so well , how did it crash?

Not wise decisions :

• The majority of stock shareholders / inverters knew little to nothing about the company they were investing in.

• Investors mortgaged their homes and foolishly invested their life savings into hot stocks such as The Dow and Ford. They was put under a belief that the stalk market could not fall but only go up

• people took out loans , used credit, used margin and bought bonds knowing that they could not afford or would be able to pay them back.

• On October 29(Black Tuesday) share prices fell by $40 billion in a single day. Because of big companies like The Dow sank from 400 to 145. In just three days, over $5 billion worth of market capitalization had been erased from New York Stock Exchange

• This cause a panic amongst the investors they all ran to the banks to retrieve the money that they already had while they still could.

•banks mostly ran on the deposits of people, individual investors were not the only ones with there hands in the stock market . The banks used the deposits as loans to give out to others and also used the deposits to invest in not-so-sure business and stocks. When the stock market crashed the banks lost most of it's money and was unable to give or return money to the people.

But....