Why did so many people invest in the stock market in the 1920s?

They felt it was safer to invest in stocks than in bank deposits.

They had faith in the stock market because it was well regulated.

They believed the majority of stocks were undervalued at that time.

They could buy stocks "on the margin," so they needed less initial capital.

Question

Why did so many people invest in the stock market in the 1920s?

They felt it was safer to invest in stocks than in bank deposits.

They had faith in the stock market because it was well regulated.

They believed the majority of stocks were undervalued at that time.

They could buy stocks "on the margin," so they needed less initial capital.

phebe · Answer

After WW1, Europe was devestated finacially and phsycologically. America, with the least involvement as a major power, was generally unscathed, and our economy boomed with loans that needed to be paid back by France and Britain, (the money they gave to us came from Germany which they practically brought to its demise untill Hitler showed up, but thats another story). With all that money industry exploded and comercial investment skyrocketed, and our trucking industry got its first real start after manufacturing trucks to be used over seas. And oil discoverys were still going strong in the southwest.