How did the famous “Black Thursday” come about?
We all know that the United States is now the only superpower in the world. It is not only powerful in military, but also very strong in economy. From the moment of the founding of the United States, the economic model of the United States has been the capitalist model. This economic model is based on capital, and all other production factors that have nothing to do with capital, such as labor and land, do not occupy a dominant position. In order to realize the dominance of capital, the corresponding ownership is private ownership, and the corresponding distribution system is distributed according to free market transactions. Absolute property rights and freedom of contract are the most important features of capitalism.
the inevitable cyclical economic crisis
Although capitalism has advantages, it does not mean that capitalism is the ideal social and economic system of human beings, and it is not perfect. Capitalism is headed by capital, so human labor is meaningless in the eyes of capitalism. It is very unfair for human labor to be measured only by economic value, which is a very single economic value. In addition, capitalism also has a very big drawback, that is, there are inevitable cyclical economic crises.
Before 1929, the economic situation in the United States was very good, and it seemed that it was gradually heading for prosperity. The stock market rose continuously, all investors made a lot of money, and the overall economic trend of the United States was good. However, everyone ignored the crisis hidden in this great economic situation. At that time, although investors made a lot of money, their spending power did not rise significantly, and workers’ wages barely changed. You know, investors who invest in the U.S. stock market account for only 10% of the entire population of the United States, which means that only these 10% are benefiting from the rising stock market and reinvesting the money they earn in other industries.
In this way, in fact, the sales of ordinary goods in the United States have not continued to grow. Looking at this prosperity, the overall economy is normal but very slow. In addition, the economic growth of the United States depends entirely on the stock market, and consumption comes from the profits of the story, and the profits will eventually return to the stock market again, which has created a very false prosperity in the US economy.
Origin of Black Thursday
On October 24, 1929, this day was called Black Thursday by countless economists in the United States. Since this day, the trading volume of the New York Stock Exchange in the United States has been constantly setting the lowest record, and the meter cannot keep up with the actual price, but the United States Investors aren’t panicking, and in their minds, historically every dip ends up multiplying, and everyone thinks the stock market will get better in October. But in October, the stock market was not as investors wished, so many people had to sell their stocks and repay the loans for stock speculation.
On this day, all investors are frantically looking for buyers. The stock price is no longer falling bit by bit, but showing a cliff-like decline. The US economy is collapsing rapidly. However, at this time, US President Hoover did not find the place where the US economy collapsed. Instead, he ordered the capitalists to increase the wages of workers, but it did nothing to make up for it. In this way, the Great Depression in the United States continued for several years.