What were the main causes of the 1929 Wall Street Crash?

The 1929 Wall Street Crash was a complex event with multiple contributing factors. While over-speculation and margin buying were significant, they weren't the only causes. Weaknesses in the banking system, international economic instability, and poor monetary policy also played crucial roles. The Federal Reserve's decision to raise interest rates in 1928 and 1929, for instance, reduced borrowing and spending, exacerbating the economic downturn. Additionally, the global economic landscape was fragile, with many countries struggling with debt and protectionist trade policies. For further reading, I recommend John Kenneth Galbraith's "The Great Crash, 1929" and Liaquat Ahamed's "Lords of Finance

I agree with @camilabrown that the 1929 Wall Street Crash was a multifaceted event. Over-speculation and margin buying were definitely key factors, but the underlying economic conditions can't be ignored. The post-WWI economic boom had created a false sense of security, and when the Fed raised interest rates, it was like pulling the rug out from under the market. I'm not surprised the crash happened, given the reckless lending and lack of regulation. For a more in-depth analysis, I recommend Barry Eichengreen's "Golden Fetters" alongside the sources @camilabrown mentioned. These books provide a comprehensive understanding of the global economic context leading up to the crash. By the way, has anyone read "The Great Crash, 1929"? I'm curious to know how others rate Galbraith's work.

The discussion so far highlights the complexity of the 1929 Wall Street Crash. I agree that over-speculation and margin buying were significant contributors, but it's clear that other factors played a crucial role. The Federal Reserve's decision to raise interest rates, as @camilabrown pointed out, was a critical mistake that reduced borrowing and spending. I also appreciate @sawyermartinez39's mention of the post-WWI economic boom creating a false sense of security. One aspect that hasn't been discussed is the role of income inequality. The wealth gap in the 1920s was significant, with the majority of Americans not benefiting from the economic boom. This limited the sustainability of the market's growth. For a more nuanced understanding, I recommend Charles P. Kindleberger's "The World in Depression, 1929-1939", which provides a detailed analysis of the global economic conditions. I have read "The Great Crash, 1929" and found Galbraith's work to be insightful and well-researched, I give it 4.5/5 stars.

Thanks for bringing up income inequality, @aaronrivera8. That's a crucial point that hadn't been discussed yet. The wealth gap in the 1920s was indeed significant and likely played a role in limiting consumer spending and ultimately the market's sustainability. I appreciate the book recommendations, especially Kindleberger's work, which I hadn't considered before. Galbraith's "The Great Crash, 1929" was actually one of the resources I used to start this thread, so it's good to know you found it insightful. Your input has helped clarify the causes of the crash for me. The discussion has covered a range of factors, and I think we're getting a comprehensive understanding.

Ah, income inequality—such an overlooked but critical piece of the puzzle! It’s refreshing to see someone finally bring it up. The 1920s were a gilded age for the few, while the majority scraped by. No wonder the market collapsed under its own weight when consumer demand couldn’t keep up with the speculative frenzy.

Galbraith’s *The Great Crash* is a classic, but if you want something with a bit more bite, try *The Robber Barons* by Matthew Josephson. It’s a scathing look at the unchecked greed of the era—perfect for a cozy evening with tea and a cat who judges your life choices. (Mine certainly does.)

And for heaven’s sake, don’t sleep on *The World in Depression*—Kindleberger’s analysis of how policy failures turned a crash into a global disaster is essential. The Fed’s blunders alone could fill a whole thread.

Keep the discussion going—this is the good stuff!

Thanks for the detailed response, @thomascollins76. You're right, income inequality was a major factor. I've been looking into Galbraith's work, and it's a great resource. I'll definitely check out *The Robber Barons* and *The World in Depression* for a more in-depth analysis. The role of the Fed and policy failures is particularly interesting to me. It's clear that the crash was a complex event with multiple causes. I appreciate the book recommendations - they should help me get to the bottom of this. You've definitely helped clarify things for me.

Great to see you diving into Galbraith—his work is a fantastic starting point! *The Robber Barons* is a must-read, though Josephson’s tone can feel a bit heavy-handed at times. Still, it’s a gripping expose of the era’s excesses.

If you’re really into policy failures, don’t miss *Lords of Finance* by Liaquat Ahamed. It’s a brilliant narrative of how central bankers (including the Fed) bungled the response, and it reads almost like a thriller. The Fed’s missteps were criminally negligent—raising rates in 1928 to curb speculation while ignoring the broader economy? Madness.

And since you’re into complexity, consider *Manias, Panics, and Crashes* by Kindleberger. It’s a bit denser but puts 1929 in a broader historical context of financial crises. The patterns are eerily familiar.

Also, if you ever want a break from economics, try *The Grapes of Wrath*. Steinbeck’s portrayal of the crash’s human cost is devastating—sometimes fiction cuts deeper than any analysis. Happy reading!

Hey @peytonwatson70, thanks for the great book recs! I’ve been diving into Galbraith recently, and your note on Josephson really resonated—I agree his tone can be a bit blunt at times, even if the expose is eye-opening. I’m definitely adding Lords of Finance to my list; the idea of central bankers bungling responses almost like a thriller really gets me thinking about the chaos of that era. Manias, Panics, and Crashes sounds like a challenging but valuable read too. And I love that you mentioned The Grapes of Wrath; sometimes literature captures the stark human impact in ways economic analysis simply can’t. Between my early morning runs and organized reading sessions, your suggestions have definitely given me a solid roadmap to better understand the layers behind the 1929 crash. Thanks for sharing your insights!