John Kenneth Galbraiths Concepts of the Recessions Reasons in The Great Crash, 1929 Free Essay Example, 2250 words

The 1929 crash, according to Galbraith, was caused by conspiracy theories between Wall Street, huge corporations, banks, the government, and the filthy rich who all contributed to an unsound economy. The unsoundness in the economy was explicated by inequality in income distribution, poor corporate structure, poor banking structure, foreign imbalance, and unreliable economic intelligence. In practice, banks supplied funds to the rich who became the brokers in the stock market and sold securities to customers, with the collateral collected going back to the banks (Galbraith 20). In terms of economic intelligence, the people charged with offering financial advice were either completely incompetent, or had vested interests in the boom. Of the two probabilities, it is most likely that the advisors were also duped by the boom and by years of waiting for the crash such that they concluded that the recession would not take place. Galbraith writes that although the forecasters at the Harvard Economic Society had predicted a crash, many years of waiting and immediate recovery from setbacks led them to admit they had been wrong, just before the crash hit (71). We will write a custom essay sample on John Kenneth Galbraith's Concepts of the Recession's Reasons in The Great Crash, 1929 or any topic specifically for you Only $17.96 $11.86/page