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.

anonymous · Answer

In the 1920's, things were really good in the US and around the world. The increase in companies was causing growth in the economy. With technology improving quickly, many people expected the economy to rise. [ During the 1920's, people received more income. So, they spent more and stock prices began to rise. ]