Which event is often cited as a cause of the Stock Market Crash of 1929?

Buying stocks on the margin is commonly identified as a significant cause of the Stock Market Crash of 1929. This practice allowed investors to purchase a larger number of shares than they could afford by borrowing money, thereby amplifying potential gains. However, it also increased risks; when stock values began to plummet, many investors found themselves unable to repay their loans. This situation led to widespread panic selling, contributing to the market's rapid decline. The reliance on margin buying created a speculative bubble, making the stock market highly volatile and unsustainable.

Additionally, while high interest rates, global economic policy, and trade tariffs played roles in the broader economic context of the era, they did not have the same direct impact on investor behavior and market dynamics as buying on margin did. In this way, the practice of buying stocks on the margin is seen as a catalyst that triggered the crash and set the stage for the ensuing Great Depression.