why was there a great crash in 1929? - speculation
● Many people became speculators - 600,000 by 1929.
● Many people were buying shares 'on the margin' (borrowing 90% of the share value to buy the shares, hoping to pay back the loan with the profit they made on the sale). American speculators borrowed $9bn for speculating in 1929.
● Some firms which were not sound investments floated shares (e.g. one was set up to develop a South American mine which did not exist), but people still bought them, because they expected to make a profit in the bull market.