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How was gambling related to the Great Depression?

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drugy | Student, Grade 10 | (Level 1) Salutatorian

Posted February 21, 2012 at 9:39 PM via web

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How was gambling related to the Great Depression?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted February 21, 2012 at 10:35 PM (Answer #1)

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Gambling in the sense of going to a casino had nothing to do with the Great Depression.  However, one of the causes of the Depression was what you might call gambling with regard to the stock market.

In the 1920s, Americans thought that stock prices would go up forever.  So they did things like borrowing money to buy stocks.  This can be seen as a form of gambling.  It was not that people were carefully deciding which stocks to buy.  Instead, they were just buying and hoping/assuming prices would rise.  This gambling created excessively high stock prices which then crashed, starting the Depression.

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