Respuesta :
The banking crisis of 1907 that preceded the Great Depression and the banking crisis in 2008 were both caused by (C) risky speculation in real estate and the stock market.
What was the banking crisis of 1907?
- The Bank Panic of 1907 was a brief banking and financial crisis in the United States at the turn of the twentieth century.
- It was caused by the collapse of highly leveraged speculative investments fostered by the US Treasury's easy money policies in the preceding years.
- The Panic was precipitated by a surge in speculative investment fueled by lax monetary policy.
- Without a national central bank to rely on, the United States' financial markets were bailed out of the crisis by personal cash, guarantees, and prominent bankers and investors such as J.P. Morgan and John D.
What was the Great depression banking crisis of 2008?
- The 2008 financial crisis, often known as the Global Financial Disaster (GFC), was a major global economic crisis that occurred in the early twenty-first century.
- It was the worst economic catastrophe since the Great Depression (1929).
- The seeds of the financial crisis were sown during years of ultra-low interest rates and lax lending regulations in the United States, which drove a home price bubble and reckless speculation in real estate and the stock market.
- As usual, it began with good intentions.
The description of both the banking crisis states that it was caused by reckless speculation in the real state and the stock market.
Therefore, the banking crisis of 1907 that preceded the Great Depression and the banking crisis in 2008 were both caused by (C) risky speculation in real estate and the stock market.
Know more about the Great Depression here:
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Complete question:
The banking crisis of 1907 that preceded the Great Depression and the banking crisis in 2008 were both caused by:
(A) short-run business cycle fluctuations.
(B) lack of investment spending and high unemployment.
(C) risky speculation in real estate and the stock market.
(D) low labor productivity in the United States combined with a huge trade deficit.
