Black monday stock market crash 1987 quizlet

Black monday stock market crash 1987 quizlet

Posted: poet Date: 29.06.2017

Log in Sign up.

ucujaluxu.web.fc2.com

How can we help? What is your email? Upgrade to remove ads. Hamilton Economics - The Report on Manufacturers. The Report on Manufacturers by Alexander Hamilton was based on the growth of the American industrial system.

The Report was presented to Congress on December 5, It was a series of economic policies to stimulate long term economic growth of the new Republic's economy. This would be accomplished by giving subsidies, or government grants, to industry.

However, as in many other cases including the Domestic IOU's and the First National Bank, Thomas Jefferson and Alexander Hamilton had conflicting views. Jefferson opposed the idea of giving out subsidies because subsidies primarily go to the rich, leaving the poor exposed. He believed that it was not very democratic, and therefore opposed it. It also ensured the independence won with the termination of the Revolutionary War.

This report would also be incorporated into Henry Clay's American System. The First National Bank was a federal banking institution created in and championed by Alexander Hamilton. Hamilton believed that a national bank along with a mint and excise taxes to stabilize and improve the nation's credit.

When first proposed, it received opposition from Thomas Jefferson and James Madison, who believed it to be an overreach of federal power.

The bank had a year charter and it expired in The Second National Bank was the second federal Hamiltonian bank and was chartered in , five years after the expiration of the first. This bank also had a year charter, and became a major issue in the election of The bank failed to control paper money through , when Nicholas Biddle was appointed president.

Under his guidance from , the bank became a powerful institution and moderated credit effectively. However, when Jackson was elected president in , it was attacked mercilessly; regardless of its merits. For the presidential election, Biddle was encouraged to push for recharter early in order to make the Bank a debate issue. Jackson vetoed the recharter bill, and then continued to disempower the bank until , when it became a private corporation.

The cotton gin is a machine invented by Eli Whitney that greatly increased productivity and efficiency of cotton separation and preparation. This machine automatically removed cotton seeds from the cotton, and greatly increased the amount of cotton that could be produced. The gin revolutionized the cotton industry in the southern U. With the growth of the industry, a need for workers arose and slaves began once again to pour into the country.

The cotton gin is considered a contributing factor to the American Civil War. This panic was the first major financial crisis in the U.

Excessive spending and overextension of the credit of the Second Bank of the United States precipitated this panic. Post-War of good feeling encouraged heavy lending by banks across the U. The smaller banks lent in excess to speculators, and the Second Bank lent in excess to politicians, stockholders, and other banks.

In , the Bank of the U. When unable to pay, state banks were forced to foreclose on the speculators and farms they had been lending to. This panic led to countless bankruptcies and unemployment. Henry Clay's American System. The system was first proposed by Henry Clay in the early nineteenth century, and it had three main points of focus: The young US was still in need of truly developing itself as a nation and it needed to strengthen its image in the eyes of foreign European powers.

Much of the support for the idea came from the Whig party. The first industrial revolution was the change from primarily hand labor to the use of basic machines and new manufacturing processes. It utilized water and steam power and coal as a source of power. Textiles were one of the first major industries to lead America into the Industrial Revolution.

Some historians go so far as to say that the Industrial Revolution was the greatest development in mankind since the domestication of animals. This shouldn't be confused with the second industrial revolution in which steam powered boats and trains developed along with more complex machinery development in some steam powered factories.

The technology for roads at the time wasn't good enough to sustain the weight of many new heavy products that needed to be shipped long distances. Essentially man made rivers, canals allowed new barges and boats to get places where rivers couldn't reach, and it allowed further westward expansion.

First patented by James Watt, the steamboat was the first major use of steam energy, and it was instrumental in ushering in the industrial revolution. John Fitch made the first successful steamboat in Robert Fulton then came along and turned the steamboat into a successful commercial business venture. James Watt again was instrumental in fixing preexisting models of steam engines and making them practical for implementation throughout America.

Trains also allowed for the simpler transportation of raw materials in a more timely fashion, such as coal. It also was crucial in connecting rural people to the ever-changing modern and urban world.

The beginning of the s abounded with expansion and prosperity. Much of this growth was fueled by construction of railroads and canals, as well as millions of acres of publics lands sold to speculators by the government.

Those speculators hoped to purchase good parcels of land that would increase in value as the new transportation expanded traffic. These sales, along with the Tariff of , otherwise the Compromise Tariff of , allowed Jackson to pay off the national debt through his policy of retrenchment and reform.

However, state bank notes became the popular payment for public land purchases, and as a result, Jackson issued the Specie Circular just before leaving office. This order commanded the Treasury to only accept gold and silver as payment for such sales. Also, the Deposit and Distribution Act of placed specie from a federal surplus into western state banks, forcing eastern banks to scale back loans, which helped cause the depression, along with the uselessness of paper money.

Mercantile interests generally crashed, and bankruptcy engulfed the nation. The banking system of the country suffered a general collapse, and unemployment proliferated.

As a result, Van Buren proposed the Independent Treasury System, which would keep banks more accountable. The depression eventually ended in , partially due to the raising of the tariff to thirty percent. The Panic of was caused by a loss of confidence in an Ohio bank, but spread as railroads failed and fears that the government could not fulfill its obligations in specie.

More than 5, businesses failed over its course and unemployment was rampant. The Panic didn't fully dissipate until the Civil War. The recession ended a period of prosperity following the Mexican-American War and the discovery of gold in California. Gold pouring into the economy helped inflate the currency. The direct event that caused the panic was the collapse of Ohio Life Insurance and Trust Co.

Other causes included the decision of British investors to withdraw funds from American Banks, the fall of grain prices due to the end of the Crimean War, and the collapse of land speculation programs.

black monday stock market crash 1987 quizlet

As said earlier, 5, businesses failed, but the Panic was remedied in part by the sale of revenue bonds and the reduction of the tariff to twenty percent. The South was relatively unaffected by the panic. Black Friday was the collapse of the American gold market on September 24, due to the efforts of Jay Gould and Jim Fisk. Grant, the president at the time, sought to strengthen the economy by removing greenbacks from the system and replacing it with gold-backed currency. This plan, if carried out, would spoil the plans of Gould and Fisk, who were buying as much gold as possible in order to get the value to rise, and then when the price of gold was high enough, they would sell and make a huge profit.

Gould, Fisk, and Corbin, a recruit of theirs who was married to Grant's sister, worked to convince Grant not to release currency into the market. It worked for a while, but Grant discovered he was being conned, and ordered the sale of government gold. However, when the government gold hit the market, so did panic. Within minutes, the price plummeted, and the investors, many of whom had bought on credit, were ruined.

There was not much of a depression, however, there was one after the Panic of They wanted to build a new railroad with this money, but rather, filed for bankruptcy. This set off a chain reaction where many banks began to go under and the closing of the stock market for several days.

Factories and businesses had to lay off customers and this began to lead the United States into a depression. Railroad companies began to fail and this led to wages for the workers being cut drastically. As a result, The Great Railroad Strike of occurred.

The Panic of occurred because of over-extension of railroad business where the costs far exceeded the available money. In addition, price for farm commodities dropped and the influx of silver into the currency system decreased currency value.

Many banks closed because of this, and the Pullman Strike and the Coxey's Army march occurred during this time. The Pullman Strike resulted from the drastic wage cuts for railroad workers at the Pullman Company.

This was the first Stock Market Crash on the New York Stock Exchange. The main person involved in the incident was Edward Henry Harriman who was the chairman of the executive committee of the Union Pacific.

His goal was to monopolize the Chicago Rail Market. His main opponent was James J. Hill, who had allied himself with financer J.

The main reason for the crash was Harriman's attempt to gain control of Northern Pacific by buying its stock. This began the devaluing of other stock which led to many investors to sell all there stock at once causing total collapse and chaos. Northern Pacific managed to not only avoid the damage but went up in worth.

The result was the formation of the Northern Securities Company run by Hill and Harriman. This holding company was later shut down by the Sherman Anti-Trust Act in the court case, Northern Securities Co. Carnegie was a Scottish-American man who believed in putting his riches into improving society through colleges and other public services.

He stated this belief in his "Gospel of Wealth".

He built up the Carnegie Steel Company from the ground up and was later able to sell it for approximately His steel company was dominant in the industry and afterward he set up many companies to help the poor. He is a true rags to riches story. John D Rockefeller - Standard Oil. Rockefeller was an American Business man who was had a major Horizontal Monopoly of the oil refining business. He got into the kerosene and gasoline business as the importance of these fuels began to rise. He quickly became one of the richest men in the world and the first billionaire in the US.

Standard Oil had almost a complete horizontal monopoly in the refining of the oils and was a leader in petroleum production. The company was able to control the price of most of the refining in the US and was extremely successful. The company was later broken up because of the Sherman-Antitrust Act.

Jay Gould - Railroads. Jay Gould was a leading developer and speculator of railroads. He is the 9th richest man in US history. At his most successful time he owned four major railroads and he could drive stock prices up and down at will, making him extremely powerful and in control. At this time he controlled one ninth of the rail in the US and later that went up to 15 percent.

The rails made him an extremely wealthy man and he was able to make it out of the business, after withdrawing his management of Union Pacific Rail, a very wealthy man.

He also later took control of telegraph lines and elevated rail in New York. During the Great Southwest Railroad Strike of he was accused of saying "I can hire one-half of the working class to kill the other half". He was a financier and banker who attracted very large companies and was able to make a large amount of money. While he was in business he arranged the merging of Edison General Electric and Thomson-Houston Electric to form General Electric. He was also a big name in the steel business when he financed the creation of Federal Steel Company and merged with Carnage Steel and several other steel companies to form the United States Steel Company.

He was part of the solution that ended the Panic of and when he died he left his house and his massive book collection to The Morgan Library and Museum, to serve the people and to be remembered.

Henry Ford - automobiles. Ford reinvented the automobile from a rich luxurious item to a common tool that everyone had. His company was a pioneer in the use of the assembly line on such a large scale. He also was one of the few extremely wealthy men to give his workers good wages and the companies work on the model-T made a car the consumer and common item that it is today.

He was a strong believer in the consumer and revolutionized not only the auto industry but others with his high wages and ways of production. The Panic of began in October of that year and the economy did not fully recover until January of The panic was caused by a failed attempt to "corner" the copper market by buying up stock of the United Copper Company and forcing its price to rise.

The stock rose too high, banks began to approach bankruptcy, and people began to take their money out of the economy and banks. After the collapse of the Knickerbocker Trust Company and many other trusts and banks, a crisis swept the nation that was already in a sort-of recession. People lost faith in the banks and the economy was unstable and not moving fluidly. Spirits were running extremely low; however, financier J. P Morgan was able to partially stimulate the economy by pledging his own sums of money to a multitude of different New York banks.

Also, when several investors were buying up the Tennessee Coal Iron and Railroad Company's stock and it looked as if the stock was going to crash, Morgan's U.

S Steel Corporation was approved by Teddy Roosevelt to step in and take over. As a result of the Panic of , the Federal Reserve System was created and the Aldrich-Vreeland Act was passed. This act authorized national banks to issue emergency currency that was covered by the federal government and several committees of distribution.

Wall Street Crash of The Wall Street Crash of refers to the initial crash of the stock market that plunged the United States, and the rest of the world for that matter, into a depression of massive measure.

Years and years of trading on margin and not facing debt in the "Roaring 20's" led to the plummet that rocked society. Since so much money was lost, companies and banks went bankrupt, layoffs and unemployment were common, the poor were forced to live without the little necessity they once had, and the rich were forced to help revive the economy using their own fortune.

It wasn't until World War II and war industry pulled the economy out of the depression in the early 's. Beginning after the stock market crash in October , the Great Depression was the longest economic depression in the history of the US.

At its peak, 15 million Americans were unemployed and half of the banks in the country failed. Franklin Roosevelt did most of the work to try to save the country but World War II really pulled the country out of despair. Caused mostly by an excess of consumer products and stock prices continuing to rise, the stock market crashed. Hoover did little to help in the depression with most help coming too late.

He tried loaning businesses money but when they could not pay them back, it only made the depression worse. FDR's first action was to announce a bank-holiday in which all banks would close and could not reopen until inspected and approved by the government.

The first days passed legislation to help stabilize industrial and agricultural prices. Other programs implemented included the Tennessee Valley Authority and Works Progress Administration, which employed men to work civil service projects.

Once World War II started, the economy started to recover as spending and trading increased with European powers at war.

Post War Prosperity As World War II ended, soldiers returned home looking for jobs. Many worried about another depression, but legislation helped to prevent that. In the Taft-Hartley Act, restrictions were placed on unions and were made liable for damages during strikes. Bill of Rights also helped by allowing more jobs to be created or employment seekers to be diverted for a while.

Veterans were given grants to go back to school and learn a skill or if they opened their own business. Technology increased, creating more jobs in the airline, medical, and communications industries. Much of this prosperity is due to the way veterans were handled when returning from war and continuing consumer spending throughout the Cold War.

Silver Certificate. Risk Management - ucujaluxu.web.fc2.come

In , Middle-eastern nations who were members of OPEC stopped exporting oil to the United States in protest of their support of Israel. There were dramatics results almost instantaneously, with the average price of gas rising from twenty-five cents to over a dollar and many gas stations being without gas for a week. Stagflation, derived from the terms stagnant and inflation, also occurred in the s.

During this decade, people had to deal with a stagnant economy that grew worse when compounded with the dropping of the US Dollar's value. Reaganomics was the economic plan instituted by Ronald Reagan. The idea was to lower taxes for everyone to increase their buying power. This would help reduce the size of the federal government while also stimulating the economy, and it would encourage investment into and productivity of private businesses.

Black Monday was a significant stock market crash in , when international stocks plummeted in a very short time period, especially the Dow Jones. The crashes causes quite likely occurred due to overvaluation, illiquidity, market psychology, and possibly program trading of stocks. When the Hong Kong market collapsed, it caused a crisis of confidence, and stocks plummeted on October 19, just as conflict between the United States and Iran escalated in the Persian Gulf.

It was the largest one-day decline in Dow Jones history, and took markets around the world at least two years to recover. The market rebounded the following year. Though no major economic decline occurred as a result of Black Monday, many private companies that planned to go public cancelled their plans, and program trading gained new regulations to prevent huge losses.

The Savings and Loans Crisis of the s and s was the mass closing of saving and loans associations across the country, resulting in massive sums of money being lost. Estimates of the loss range anywhere from to billion dollars lost, including at least billion taxpayer dollars lost in the process. The Tax Reform Act of , deregulation of savings and loan associations, and the end of inflation all contributed to the closing of 1, of 3, of these associations.

These groups were also vulnerable to Ponzi schemes, which contributed to massive losses. These institutions lent too much money for real estate investments, and many large ones folded. The government spent billion dollars to fix the crisis, resulting in the loss of billions for taxpayers. It caused a mini-recession from , as the real estate industry also tumbled s a result.

inserted by FC2 system