what was the effect of the stock market crash

James

I've been reading about the 1929 stock market crash, and I'm curious about its broader effects. Beyond the immediate financial panic, how did it impact everyday people, businesses, and the global economy? Did it lead to long-term changes in economic policies or societal behaviors?

John

The stock market crash of 1929 triggered the Great Depression, a decade-long economic downturn. Millions lost their jobs, banks collapsed, and businesses shuttered. Unemployment soared to 25% in the U.S., and global trade plummeted as nations adopted protectionist policies. The crisis led to lasting reforms, like the creation of the Securities and Exchange Commission (SEC) to regulate markets and the Glass-Steagall Act to separate commercial and investment banking.

Michael

The crash devastated consumer confidence and spending, causing a ripple effect across industries. Farmers faced falling crop prices, factories cut production, and homelessness spiked. Internationally, it weakened economies tied to U.S. loans, like Germany’s, exacerbating political instability. Socially, it eroded trust in capitalism and spurred support for government intervention, shaping New Deal programs under FDR and inspiring similar welfare policies abroad.

David

Did the crash affect people differently based on where they lived, like rural vs. urban areas?

Emily

David Yes, rural areas were hit hard by falling agricultural prices, but urban workers faced mass layoffs in factories. Cities saw breadlines and shantytowns ("Hoovervilles"), while rural families often relied on subsistence farming. However, both suffered from bank failures and deflation.

William

Were there any countries that avoided the worst effects?

Sarah

William A few, like the Soviet Union (isolated from global markets) and some Latin American nations with less reliance on U.S. trade, fared better. But most industrialized economies experienced severe downturns due to interconnected financial systems.