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Stock Speculation
Updated: 9/16/2020
Stock Speculation
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Storyboard Text

  • Then lets expand our manufacture son, because if not I fire you bud.
  • Hey boss only 2% of Americans are buying our stocks
  • Easiest thing I've ever done, I'm going to be rich after this .
  • Im taking all your money, give it to me now before i beat you like i squash my quac
  • I only have $10 so ill just borrow the other $10and pay it off later.
  • that will be $20.68
  • By 1925 Only 2% of Americans were buying stock so as manufacturing continued to expand, stock prices climbed upward and investors made money.
  • Huuuuuh its right here.
  • Wheres my 10%.
  • It appeared to be an especially safe way to make easy money. However, investors were not protected from misleading information about stocks. It was difficult for investors to know exactly what they were buying.
  • wheres my money.
  • what are you doing here Broker.
  • i need more time
  • Buying on margin means that a person purchases a stock by using a bit of his or her own money and borrowing the rest. It is similar to buying on credit. For example, to purchase a $100 stock the buyer might put up $20 and borrow $80 to make up the entire price.
  • same man its so annoying.
  • The brokers set a margin limit. In the example the margin limit was 20 percent, meaning that the investor had to keep 20 percent of his or her own cash invested in the stock.
  • Consider what would happen if the investor in the previous example saw the price of his or her stock drop rather than rise. If the $100 price of the stock dropped to $70, then selling the stock at $70 would not even pay back the loan from the broker. The investor, owing $80 but having only $70, would have to come up with more cash.
  • In only a few days several million investors lost all the money they had invested, as the market turned into the worst "bear" market of the twentieth century. One day these investors had been wealthy; the next, they wondered how they would survive.
  • all my employes lost there jobs because they were all investing.
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