Underlying Economic Problems contributed to the Wall Street Crash

Underlying Economic Problems contributed to the Wall Street Crash

1. Wealth was distributed unequally

   • Rising profits were not passed on to workers, so some people were too poor to spend and so there was less demand than production

2. Overproduction

   • After too much had been produced companies started to lay off staff, leading to unemployment
   • More was being made than needed

3. Banks were largely unregulated

4. Expensive loans

   • People had been borrowing money in the 'boom' time to buy shares, but loans couldn't be repaid after the crash

5. Bad market for American goods

   • Barriers to trade (like tariffs)
   • European countries had suffered after the war