Editing Wall Street crash of 1929 (section)

==Effects==
===United States===
{{Further|Causes of the Great Depression}}
[[File:American union bank.gif|thumb|Crowd at New York's American Union Bank during a [[bank run]] early in the Great Depression]]
Together, the 1929 stock market crash and the Great Depression formed the largest financial crisis of the 20th century.<ref>{{Cite news |date=August 11, 2008 |title=Paulson affirms Bush assessment |url=https://www.washingtontimes.com/news/2008/aug/11/paulson-affirms-bush-assessment/ |work=The Washington Times}}</ref> The panic of October 1929 has come to serve as a symbol of the economic contraction that gripped the world during the next decade.<ref>{{cite news |first=Albert |last=Scardino |title=The Market Turmoil: Past lessons, present advice; Did '29 Crash Spark The Depression? |url=https://query.nytimes.com/gst/fullpage.html?res=9B0DE4DC1F3BF932A15753C1A961948260 |work=The New York Times |date=October 21, 1987 }}</ref> The falls in share prices on October 24 and 29, 1929 were practically instantaneous in all financial markets, except Japan.<ref name="ref2">{{Cite news |last=Lambert |first=Richard |date=July 18, 2008 |title=Crashes, bangs and wallops |url=https://www.ft.com/content/3cc7b1b2-52f2-11dd-9ba7-000077b07658 |access-date=2024-10-22 |work=Financial Times}}</ref>

The Wall Street Crash had a major impact on the U.S. and world economy, and it has been the source of intense academic historical, economic, and political debate from its aftermath until the present day. Some people believed that abuses by utility holding companies contributed to the Wall Street Crash of 1929 and the Great Depression that followed.<ref name="timesonline1">{{Cite news |last=Jameson |first=Angela |date=2005-08-10 |title=Pyramid structures brought down by Wall Street Crash |url=https://www.thetimes.com/article/pyramid-structures-brought-down-by-wall-street-crash-q689hbsg2w7 |access-date=2024-10-22 |work=The Times |language=en}}</ref> Many people blamed the crash on commercial banks that were too eager to put deposits at risk on the stock market.<ref>{{Cite news |last=Brockman |first=Joshua |date=September 22, 2008 |title=Death of the Brokerage: The Future of Wall Street |url=https://www.npr.org/2008/09/22/94894707/death-of-the-brokerage-the-future-of-wall-street |work=National Public Radio}}</ref>

In 1930, 1,352 banks held more than $853 million in deposits; in 1931, one year later, 2,294 banks failed with nearly $1.7 billion in deposits. Many businesses failed (28,285 failures and a daily rate of 133 in 1931).{{citation needed|date=October 2020}}

The 1929 crash brought the [[Roaring Twenties]] to a halt.<ref>{{Cite news |date=2008-09-21 |title=Kaboom!...and bust. The crash of 2008 |url=https://www.thetimes.com/article/kaboomand-bust-the-crash-of-2008-q3f58n3stfb |access-date=2024-10-22 |work=The Times |language=en}}</ref> As tentatively expressed by economic historian [[Charles P. Kindleberger]], in 1929, there was no [[lender of last resort]] effectively present, which, if it had existed and been properly exercised, would have been key in shortening the business slowdown that normally follows financial crises.<ref name="ref2" /> The crash instigated widespread and long-lasting consequences for the United States. Historians still debate whether the 1929 crash sparked the Great Depression<ref name="nytimes2">{{Cite news |date=1987-10-21 |title=The Market Turmoil: Past lessons, present advice; Did '29 Crash Spark The Depression? |url=https://www.nytimes.com/1987/10/21/business/the-market-turmoil-past-lessons-present-advice-did-29-crash-spark-the-depression.html |work=The New York Times}}</ref> or if it merely coincided with bursting a loose credit-inspired economic bubble. Only 16% of American households were invested in the stock market within the United States during the period leading up to this depression, suggesting that the crash carried somewhat less weight in causing it.{{citation needed|date=October 2019}}

[[File:UnemployedMarch.jpg|thumb|upright|Unemployed men march in [[Toronto]].]]
However, the psychological effects of the crash reverberated across the nation as businesses became aware of the difficulties in securing capital market investments for new projects and expansions. Business uncertainty naturally affects job security for employees, and as the American worker (the consumer) faced uncertainty with regard to income, naturally the propensity to consume declined. The decline in stock prices caused [[bankruptcies]] and severe [[macroeconomic]] difficulties, including contraction of credit, business closures, firing of workers, bank failures, decline of the money supply, and other economically depressing events.<ref>{{Cite book|url=https://books.google.com/books?id=Ae-cAAAAQBAJ&q=history+of+great+depression|title=The Great Depression|year=2012|publisher=Britannica Educational Publishing|isbn=978-1615308972|language=en}}</ref>

The resultant rise of mass unemployment is seen as a result of the crash, although the crash is by no means the sole event that contributed to the depression. The Wall Street Crash is usually seen as having the greatest impact on the events that followed and therefore is widely regarded as signaling the downward economic slide that initiated the Great Depression. True or not, the consequences were dire for almost everybody. Most academic experts agree on one aspect of the crash: It wiped out billions of dollars of wealth in one day, and this immediately depressed consumer buying.<ref name="nytimes2" />

The failure set off a worldwide run on US gold deposits (i.e., the dollar) and forced the Federal Reserve to raise interest rates into the slump. Some 4,000 banks and other lenders ultimately failed. Also, the [[uptick rule]],<ref>[http://www.ft.com/cms/s/0/0e317d72-86ac-11dd-959e-0000779fd18c.html "Practice has plenty of historical precedents"] ''Financial Times''</ref> which allowed short selling only when the last tick in a stock's price was positive, was implemented after the 1929 market crash to prevent short sellers from driving the price of a stock down in a [[bear raid]].<ref>{{Cite news |date=September 25, 2008 |title=Funds want 'uptick' rule back |url=https://www.ft.com/content/0362e760-8b24-11dd-b634-0000779fd18c |access-date=2024-10-22 |work=Financial Times}}</ref>

=== Europe ===
The stock market crash of October 1929 led directly to the Great Depression in Europe. When stocks plummeted on the [[New York Stock Exchange]], the world noticed immediately. Although financial leaders in the United Kingdom, as in the United States, vastly underestimated the extent of the crisis that ensued, it soon became clear that the world's economies were more interconnected than ever. The effects of the disruption to the global system of financing, trade, and production and the subsequent meltdown of the [[Economy of the United States|American economy]] were soon felt throughout Europe.<ref name=VT>{{Cite web|url=http://www.dhr.history.vt.edu/modules/eu/mod04_depression/context.html|title=Digital History Reader – European History – Module 04: The End of Optimism? The Great Depression in Europe|publisher=[[Virginia Tech]]|access-date=November 4, 2016}}</ref>

In 1930 and 1931, in particular, unemployed workers went on strike, demonstrated in public, and otherwise took direct action to call public attention to their plight. Within the UK, protests often focused on the so-called [[means test]], which the government had instituted in 1931 to limit the amount of unemployment payments made to individuals and families. For working people, the means test seemed an intrusive and insensitive way to deal with the chronic and relentless deprivation caused by the economic crisis. The strikes were met forcefully, with police breaking up protests, arresting demonstrators, and charging them with crimes related to the violation of public order.<ref name=VT />