The stock market crash of the 20's happened AFTER WWI.
The crash of the stock market had worsened the already severe structural damages of the United States’ economy, but the worst had yet to come due to the erroneous policies implemented by the US government:
1) In the first place, the Federal Reserve decided to defend the value of the dollar above anything and imposed higher interest rates in order to prevent the money from being turned into gold. The obvious happened, the heavily indebted consumers repudiated their debts due to the rise in interest rates and triggered a banking crisis.
2) Secondly, the FED dried up the economy by keeping the money supply very tight. This submerged the nation in a cash flow crisis and aggravated the crash in both the stock and real estate markets.
3) Finally, in an attempt to fight inflation and maintain a balanced budget, taxes were raised reducing the purchasing power even further.]
http://www.isop.ucla.edu/profmex/volume1/4fall96/Art3/Great.html
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Looks like the government has now done the opposite prior to the market crash of 1929. Interest rates are at their lowest, great exchange in real estate has occured and taxes are still low (someone has to have enough money left over to buy the goods).
There are also guarantees that our soldiers will be compensated and have/keep their jobs when they return. I just hope that will be very soon... the sooner the better.
Current Events » in reply to Re: Really ?
Re: The Market.
