1. BOOM!!!! Part two Buying and selling shares

2. Aims of the lesson By the end of this lesson you will Understand what shares are and how they are traded Understand how the stock market works Understand what we mean by buying on the margin and evaluate its importance in overinflating the economy

3. What are shares A person can buy a share in a company – they own part of it and are able to sell it and buy others if they want to If the company makes a profit they pay a dividend to each share holder Before 1920 only wealthy people could afford to buy shares Difficult to trade person to person so share exchanges were set up – Wall Street NY

4. How the stock market works Shares are worth what anyone is prepared to pay for them High demand – prices go up Low demand prices go down Ordinary people began to buy shares in order to sell them on for a profit in the 1920s Hew companies boomed – Woolworths and General Motors

5. The stock market boom As more people bought shares the prices went up and up Everyone was buying and it seemed that no one could lose out People started to borrow money in order to buy shares and sell them for a profit Banks lent other peoples money – by Autumn 1929 even the banks had forgot that the prices of shares could go down as well as up