About the hyperinflation of the 1930s
The series of happening what caused the great depression in Wall Street was the reason because all banks were started to inherit loans back from many customers at the same time. The type of loans what were inherited were so-called network loans, what is the reason for the series of bankruptcies in the 1930s was the series of news, where one bank was faced with bankruptcy. This bank was guaranteed the loans and this caused panic in the financial area.
The thing that the falling of the stock market began in Wall Street in the 24.10 and it ended 29.10.1929. Even if that falling took about five days is the remarkable thing in world history. The effect of this thing was so powerful, that it caused hyperinflation in Germany, and around the world was depression.
The thing what caused the hyper effect of this financial falling was that the thing happens in New York, and people were not experienced readers of the news. Because people believed that everything that was written in newspapers was true, and the rumors claimed that the USA was in some kind of civil conflict the effect was extremely powerful. In that time people had no media training and they were not known about the rumors and false news. That increased the effect of the fall.
The thing what caused the panic was the news, that bank was faced bankruptcy. People read that the bank had financial problems, and that caused panic, that they should take their money out from those companies. There is a conspiracy theory, that that news was written in purpose for causing the fall of the stock marketing.
And in that case, the invisible hand, what was controlling the financial world would be the news, what investors used the sources when they chose their targets for investments. But that theory about the false news, what was written in purpose has ever proven the truth. So that thing remains only as theory. But the information is in a big role in modern stock marketing.
The information what was behind the panic and depression of the financial world was the news, where was mentioned, that one bank was falling. The thing was enough, and people started to take the money away from banks, and that caused the end of the money. When people went to the streets, they saw other people waiting at the doors of banks, and take their money out, what deeper the panic.
So the thing is that if newspapers or social media would be written information, that some currencies are falling, or some nation would not have money, that thing causes panic, which means that people start to transfer financial investments out from the country. When that thing happens, the result would be very large scale depression. This is the problems with the news what is telling about financial disasters could be used in wrong purposes.
If that information what is delivered is wrong or a little bit too provocative, the chain reaction can cause destruction. And what makes this kind of things problematic is that that news should involve real or checked material, what makes them trustable. But how normal investor can check the financial condition of some corporation if in the morning would come report of the falling value of invests?
What if somebody would just take the telephone from the table, and call to market, that the company has financial problems. And then that person could claim, the leaders of the company would cover those problems. How the company would show that there is money, what it can use to payments? The thing is that those signals are really important when investors are selecting the targets for their investments.
And if it is impossible to get trusted information about the condition of the company, that means that there could be financial problems, if people cannot see the bank accounts and money transfers. Those things are protected with banking secrecy, but in that case, somebody could turn the banking secrecy against the actor, what it is meant to protect. That means that those directors cannot get information, how they could waterproofing show that there is money in the banks, and it is not earned by selling the headquarters of the company.
The series of happening what caused the great depression in Wall Street was the reason because all banks were started to inherit loans back from many customers at the same time. The type of loans what were inherited were so-called network loans, what is the reason for the series of bankruptcies in the 1930s was the series of news, where one bank was faced with bankruptcy. This bank was guaranteed the loans and this caused panic in the financial area.
The thing that the falling of the stock market began in Wall Street in the 24.10 and it ended 29.10.1929. Even if that falling took about five days is the remarkable thing in world history. The effect of this thing was so powerful, that it caused hyperinflation in Germany, and around the world was depression.
The thing what caused the hyper effect of this financial falling was that the thing happens in New York, and people were not experienced readers of the news. Because people believed that everything that was written in newspapers was true, and the rumors claimed that the USA was in some kind of civil conflict the effect was extremely powerful. In that time people had no media training and they were not known about the rumors and false news. That increased the effect of the fall.
The thing what caused the panic was the news, that bank was faced bankruptcy. People read that the bank had financial problems, and that caused panic, that they should take their money out from those companies. There is a conspiracy theory, that that news was written in purpose for causing the fall of the stock marketing.
And in that case, the invisible hand, what was controlling the financial world would be the news, what investors used the sources when they chose their targets for investments. But that theory about the false news, what was written in purpose has ever proven the truth. So that thing remains only as theory. But the information is in a big role in modern stock marketing.
The information what was behind the panic and depression of the financial world was the news, where was mentioned, that one bank was falling. The thing was enough, and people started to take the money away from banks, and that caused the end of the money. When people went to the streets, they saw other people waiting at the doors of banks, and take their money out, what deeper the panic.
So the thing is that if newspapers or social media would be written information, that some currencies are falling, or some nation would not have money, that thing causes panic, which means that people start to transfer financial investments out from the country. When that thing happens, the result would be very large scale depression. This is the problems with the news what is telling about financial disasters could be used in wrong purposes.
If that information what is delivered is wrong or a little bit too provocative, the chain reaction can cause destruction. And what makes this kind of things problematic is that that news should involve real or checked material, what makes them trustable. But how normal investor can check the financial condition of some corporation if in the morning would come report of the falling value of invests?
What if somebody would just take the telephone from the table, and call to market, that the company has financial problems. And then that person could claim, the leaders of the company would cover those problems. How the company would show that there is money, what it can use to payments? The thing is that those signals are really important when investors are selecting the targets for their investments.
And if it is impossible to get trusted information about the condition of the company, that means that there could be financial problems, if people cannot see the bank accounts and money transfers. Those things are protected with banking secrecy, but in that case, somebody could turn the banking secrecy against the actor, what it is meant to protect. That means that those directors cannot get information, how they could waterproofing show that there is money in the banks, and it is not earned by selling the headquarters of the company.
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