1929

Stock market crash on Wall Street and start of the 1930s crisis

Sharp fall in share prices in New York and in the developed market economies. Start of the Great Depression. The 1920s were years of prosperity in the United States. Share prices amplified this movement, increasing threefold between 1924 and September 1929. The trend suddenly reversed on 24 October 1929, a day which is also known as « Black Thursday ». Share prices lost nearly 40% between 22 October 22 and 13 November, dragging the other world stock markets into the turmoil. The stock market crash precipitated the United States and Europe into an economic depression that lasted, for some countries, until 1939. Banks went bankrupt or cut back on lending and businesses were no longer able to obtain financing by issuing shares, which led to a collapse in consumption and investment. The weak demand then triggered a crisis of overproduction that drove down prices, further aggravating the crisis because economic players preferred to wait and see rather than buy. Mass unemployment settled in, which further exacerbated the weakness of demand. In some countries, this depression brought about a series of fiscal stimulus packages, in particular in the United States with the « New Deal » of President F.D. Roosevelt in 1932, programmes that were theorized by Keynes in his General Theory published in 1936.