Final answer:
Excessive buying of stocks on margin, failure of international banking systems, and low prices of stocks and bonds were all factors in the stock market crash in 1929.
Step-by-step explanation:
One of the major causes of the stock market crash in 1929 was excessive buying of stocks on margin. This refers to the practice of purchasing stocks with borrowed money, where investors only paid a small percentage of the stock's value upfront and borrowed the rest from brokers. The overreliance on borrowed money in the stock market created a speculative bubble which eventually burst, leading to the crash.
The failure of international banking systems also played a role in the crash. Many European banks had invested heavily in the American stock market, and when the crash occurred, it triggered a worldwide banking crisis that further worsened the situation.
Contrary to what some may think, the low prices of stocks and bonds was not a major cause of the crash. While declining stock prices were a consequence of the crash, they were not the primary cause.
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