Causes and Similarities of the 1929 and 2008 Financial Crises

Abstract

After the famous "Coolidge Boom", the United States experienced an unprecedented economic crisis in 1929, first with the collapse of the stock market, the collapse of banks, then the shutdown of industry, the displacement of tens of millions of people, and finally through the capital market to almost all capitalist countries; A century later, another world financial crisis kicked off on Wall Street, starting with the collapse of the stock prices of the two mortgage giants in August 2008 United States leading to the bankruptcy of more than United States subprime mortgage institutions, all five major investment banks, including Lehman Brothers, and a 50 million increase in the number of poor people in the world. Through the comparative analysis of the two crises, this paper expounds the causes of the two crises respectively, and analyzes the similarity between the two crises.