During the 1920s, numerous Americans were spreading their finances too thin. A lot of people started opening lines of credit to purchase their consumer goods.
In the comment section, describe how credit can be bad for business, and what happened to the businesses when consumers were unable to repay their debts.
Whenever everyone starts to go on credit and no one is able to repay their debts, the business exhausts all of its product and get nothing in return, so eventually they run out of money and product so they have to close down
ReplyDeletecredit can go bad because some people cant pay their payments and they say they will but they won't and if they dont then the business will run out of money so they have to shut down. then there is nothing for anybody
ReplyDeleteWhen people cant pay off credit to a store, or a bank then the store or bank isnt making any money, and they end up going bankrupt and they lose everything. Its not good living on credit, because you have to pay off everything, and if you cant, then your screwed.
ReplyDeleteCredit can be bad for business because using credit just builds up a bigger and bigger debt that you will have to pay. If consumers couldn't repay their debts businesses would shut down.
ReplyDeleteSince the 1920's was becoming such an economic boom, people were not taking the future into consideration. All was good, and people basically had no worries. People were buying very expensive, luxury items with money they did not have. This left millions of people in massive debt. Since there was such a huge drop in consumer spending, (which lowered prices) meant that farmers, businesses, and nations could not repay their debt. Businesses would be quickly shut down due to their inability to pay off debt.
ReplyDeleteDuring the 1920's, credit was used for things that people couldn't normally pay for, and when people couldn't pay back those debts, the businesses they bough from didn't get the money they should've. Most businesses eventually went bankrupt and had to shut down because of this.
ReplyDeleteCredit can be bad for business because if people cant pay their debt the business never gets its money. And when consumers cant pay businesses go out of business
ReplyDeleteBuying on credit can be bad because the business could get ripped off and not get paid. If people cant pay the business pretty soon the business would shut down.
ReplyDeletecredit is bad for the consumers is a bad thing because they were putting them selfs out of jobs because no one would hire them so they could not payback the bills they need for the goods that they had bought. Since everyone started to use credit and the businesses were letting people buy with the credit that they had no money to keep the stores open witch in turn started to close most stores
ReplyDeleteWhenever everyone starts to go on credit and no one is able to repay their debts, when people dont pay the banks back then they dont make no money and turn up bankrupt .
ReplyDeleteLiving on credit is a leap of faith for both sides of the transaction; the creditor/customer is paying for something they don't have money for that can start from a 1.00 to almost 10,000.00 if the credits weren't payed off leaving the creditor in debt. For the business surviving on credit is a guessing game because you never know if the creditor will ever pay it off, leaving the business in pieces since thier source of income doesn't exist.
ReplyDeleteEconomic was becoming a problem in the 20's. People were buying all these nice things, that they knew they wouldn't be able to afford later on. They were all going into a huge debt, which would cause businesses to shut down.
ReplyDeletecredit was bad in many ways it affected the purchases people made. it was also turning into debt and people needed to repay their debt or they would have horrible credit. if people couldn't repay their debts businesses would shut down, and you would lose all of the money you had in a saving account for a bank
ReplyDeleteCredit could be considered a bad thing because when you don't have the money to afford your bills you begin going into debt. Leaving the producers at loss because they are giving the product away and running out of it while getting nothing in return.
ReplyDeleteWhen people start opening lines of credit, they don't realize how much they are spending until its gone. when its gone they have nothing to repay back or in other words pay the debt they got themselves into. business's just get screwed over and lose product with nothing in return to pay for it.
ReplyDeleteCredit could be bad for businesses because what it does is it puts them in debt and it becomes hard for them to pay off especially if that business fails. When the business fail the company still has to pay it off.
ReplyDelete-Maria Cangelosi
people were buying stuff they couldnt afford in the long run. so that made businesses shut down and go into debt.
ReplyDelete