Buying on the Margin
Notes:
(Agricultural recession- overproduction lowers prices, farmers have always been poor, first sign of the coming depression)
-Second problem- borrowing money to buy stock in the hope that it will go up and you can repay the loan and collect the difference= buying on the margin
-Second problem- borrowing money to buy stock in the hope that it will go up and you can repay the loan and collect the difference= buying on the margin
Video Link
Summary
People were buying on the margin to invest in stocks which means they borrowed money from the banks to invest. This had major repercussions were the stock market crashed.
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Audio Link
Political Cartoon
Quote
"When the market is just going up, up, and up, we all tend to be blind to the holes in the market. They're all papered over by the rise." -Ron Chernow
Subjunctive Question
Would the recession of been as bad if people had bought on the margin?