USA HISTORY

Detailed explanation-1: -Answer. The economic factor that helped create the Great Depression the most is the allowance of people to buy stocks on a margin. Buying on the margin is simply borrowing money from the brokerage to buy the stock.

Detailed explanation-2: -What were the major causes of the Great Depression? Among the suggested causes of the Great Depression are: the stock market crash of 1929; the collapse of world trade due to the Smoot-Hawley Tariff; government policies; bank failures and panics; and the collapse of the money supply.

Detailed explanation-3: -The Stock Market Crashes! The 1920s, known as the Roaring Twenties, was a time of many changes-sweeping economic, political, and social changes. There were many aspects to the economy of the 1920s that led to one of the most crucial causes of the Great Depression-the stock market crash of 1929.

Detailed explanation-4: -By then, production had already declined and unemployment had risen, leaving stocks in great excess of their real value. Among the other causes of the stock market crash of 1929 were low wages, the proliferation of debt, a struggling agricultural sector and an excess of large bank loans that could not be liquidated.

Detailed explanation-5: -This meant that many investors who had traded on margin were forced to sell off their stocks to pay back their loans – when millions of people were trying to sell stocks at the same time with very few buyers, it caused the prices to fall even more, leading to a bigger stock market crash.