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Wall Street crash - Coggle Diagram
Wall Street crash
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Bull market
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Some had warned about this - Moody's Investment Service and Harvard Economic society warned about share prices falling
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Overproduction
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Fordney-McCumber Tariff limited trade with the world - other countries had tariffs of their own on the US
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By the late 1920s, the US economy reached capacity in what the domestic market could consume
US economy lacked spending power to buy all goods produced - 40% of population owned 12.5% of the wealth
Land speculation
By 1926 the Land Boom collapsed - lack of infrastructure like roads and railways impeded development
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Thousands of new houses were built at Miami between 1920 and 1925 - Miami population grew by 100,000
1925 - International Revenue Service taxed profits on property speculation which reduced levels of speculation
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Sept 1926 - hurricane which killed 400 people and left 50,000 homeless
Rich industrialists like the Du Pont saw the possibility of land and selling it to the prosperous population who faced cold winters
This dissuaded many from investing in property - only a trickle of investors were buying property by 1927
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