The Great Depression was a time of great suffering across the world, especially in Canada. Depression in the economy happens when there is very little buying and selling, and unemployment rates are high. The Great Depression started in 1929 and lasted until the late 1930s. There are several reasons the Great Depression happened.
These unemployed men are lined up for free soup, coffee, and donuts during the Great Depression.
The Stock Market
People discovered that another way to make money was to invest in the stock market. The stock market is a place where people buy and sell shares (also called stocks) of a company. If you own a ‘share’, that means you own a small part of the company and share in its profits or losses. A company can be split into hundreds or thousands of shares and have many owners.
People were trying to make money by buying stocks in the stock market.
One of the biggest stock exchanges in the world is the New York Stock Exchange. People make their trades through brokers. They call their broker and ask them to sell or buy certain stocks.
Many companies were doing very well in the 1920s because people were buying so much stuff. The stock prices kept going up as more and more people wanted to make money in the stock market. Many people even took out bank loans to buy stocks. Even banks were investing in the stock market.
People were spending money on things like new automobiles in the 1920s.