Part 2 Chapter 16 Crash Summary and Analysis

The 1920s are referred to as the Roaring Twenties in America characterized by a bull market and economic prosperity. The pent-up demand from World War I is released. America's economy is stronger than those of the Europeans, which are devastated by the war. But the boom isn't even across the American economy. Certain major sectors, like farming, oil and textiles, are not experiencing any kind of boom. There are many small town bank failures. The boom is basically in the stock market. The 1920s are characterized by many small investors buying stocks on margin. Corporations are raising money through stock issues. The use of stocks instead of bonds as a means of financing corporate expansion does not hurt Wall Street because most of the big name players have stock affiliates. Many peddle their Latin American debt as...