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American Economy …

American Economy …. …in the 1920’s. STOCK BROKERS : - STOCK AND SHARES IN THE 1920’s -THE GREAT WALL STREET CRASH. What’s a Stock Broker?. A stock broker is a qualified professional who buys and sells shares in the stock market.

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American Economy …

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  1. American Economy… …in the 1920’s STOCK BROKERS: -STOCK AND SHARES IN THE 1920’s -THE GREAT WALL STREET CRASH

  2. What’s a Stock Broker? • A stock broker is a qualified professional who buys and sells shares in the stock market. • A typical job of a stock broker would be to help a client invest money. After the investment, a percentage of the profit is then given to the stock broker. Luck plays a big part in investing as well.

  3. Why Buy Stocks and Shares? 1,000 $1.00 stocks/shares • People buy (and “invest”) stocks and shares to earn MONEY. They believed money would “multiply”. • Buying stocks atLOW, and selling at HIGH. • For example, when 1,000 shares of stocks is put into $1.00 worth stocks that rise to $1.50, $500 is earned. Stocks can be a quick way to earn money! Investing is a form of earning money. 1,500 $1.50 stocks/shares ($500 profit) INVEST! ($1.00 increases to $1.50)

  4. Wall Street • Located in lower Manhattan, New York. • It is a street that features many large financial office buildingsandcompanieswhere stocks are traded, including: • NYSE New York Stock Exchange, • NASDAQ , • AMEX American Exchange, • NYMEX New York Mercantile Exchange, • NYBOT New York Board of Trade etc. National Association of Securities Dealers Automated Quotations A section of Wall Street today. The building on the right (with the American flag) is the main NYSE office building.

  5. Stocks and Shares in the 1920’s • During this period of time, stocks and shares rose at a phenomenal rate. • Stocks rose by 65%. • Wages increased by 25%. • People began borrowing money to invest. • In 1929, Wall Street crashed - America went into debt. +65% UH OH! +25% America’s wealth in the 1920’s

  6. Quotes • “If a man saves $15 a week, and invests in good common stocks, and allows the dividends and rights to accumulate, at the end of twenty years he will have at least $80,000 and an income from investments of around $400 a month. He will be rich. And because income can do that, I am firm in my belief that anyone not only can be rich, but ought to be rich.” – John J. Raskob John J. Raskob

  7. Major investor Will Payne, stated that the Wall Street Stock Exchange had become such an easy way to make money that it ceased to be a gamble, because in a gamble, someone loses – but when invested in stocks and shares, “everybody wins”. People thought the market could sustain the growing high prices, “Stock prices have reached what looks like a permanently high plateau.” – Irving Fisher. Quotes Irving Fisher

  8. Records • On October 24th, 12,894,650 shares were sold, setting the record in its time. Then, on October 29th, approximately 16.4 million shares were traded, breaking the record that was set 5 days earlier, only to be exceeded in 1969. Crowd gathering outside NYSE after the crash

  9. Losses • The loss from the crash was unbelievable: • 12 million people went out of work, • 12,000 people was made unemployed everyday, • 20,000 companies and 1616 banks had gone bankrupt, • 23,000 people committed suicide in one year – the highest ever. • The total loss by the end of the next week amounted to $30 million dollars, ten times more thantheannualbudget of the federal government, far more thanthe U.S. hadspent in all of WorldWar 1. • ContributingtoThe Great Depression.

  10. Some affected Companies • Statistics from the Great Wall Street Crash:

  11. Bibliography Images: • http://i23.ebayimg.com/02/i/08/10/3f/78_1_bol.JPG • http://www.lancs.ac.uk/staff/ecagrs/Photo%20Gallery%20of%20Economists_files/fisher.jpg Internet • http://www.kgv.edu.hk/history/Y9/1920s/StockMarket.ppt • http://www.spartacus.schoolnet.co.uk/USAwallstreet.htm • http://www.historylearningsite.co.uk/wall_street_crash.htm • http://www.eyewitnesstohistory.com/snpmech5.htm • http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929 Books: • THE USA 1919-1941, by Nigel Kelly Thanks to Jos Ma, Mabel Lo, VinayVaswani & Megan Chan (authors)

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