A recession or depression happens when the demand for money is greater than the supply. When this happens, people stop spending their money. The factories don't need to make as many products to sell because no one is buying them, so people lose their jobs. Then they have even less money to spend. This leads to a long slowdown in business activity. This is called a … [Read more...]
How do investors lose money when the stock market crashes?
since the stock market has come into existence , there have been several large stock market crashes that have plagued the American financial system. For example, during the Great Depression, stock prices dropped to 10% of their previous highs and during the crash of 1987, the market fell more than 20% in one day. Due to the way stocks are traded, investors can lose quite a … [Read more...]