2.

0 The main and other cause(s) that related to Stock Market Crash 2020

The 2020 stock market crash happened because of the COVID-19 pandemic, the most
impactful pandemic since the 1918 flu pandemic and the 1340's Black Death. Because of the
economic effects of the COVID-19 pandemic, growing worries and global economic
shutdown are considered to be a major cause of the stock market crash, although several
analysts have argued that it is a 'accelerating' rather than a single core factor behind the crash.

During 2019, the IMF announced that the global economy was undergoing a 'synchronized
recession,' which hit its slowest rate since the financial crisis of 2007–08.[28] 'Cracks' turned
up on the consumer market as global markets started to collapse from a 'fast downturn' in
manufacturing activity. Global growth was projected to peak in 2017, once total industrial
production worldwide dropped significantly steadily in early 2018. The IMF criticized 'strong
trade and geopolitical uncertainties' as the key reason for the downturn, citing Brexit and
China, the U.S. trade war as the prime reasons for the 2019 deceleration, while other
economists blamed liquidity problems.

The U.S. yield curve inverted in April 2019 which triggered worldwide fears of a 2020
financial crisis. During March 2019, the inverted yield curve and trade war fears prompted a
sell-off on global stock markets which prompted more fears of an imminent financial
meltdown. Rising debt rates have always been a problem for policymakers in the European
Union and the United States. The risk was, however, heightened during the economic
downturn in 2019, and analysts started to warn of a 'debt bomb' emerging during the next
market crisis. Debt at the height of the Great Financial Crisis in 2019 was 50 per cent higher
than that. Economists have concluded that, during the crisis, this rising debt is what
contributed to debt defaults in economies and companies around the world. In September
2019, the Federal Reserve started to intervene in the position of investor to provide funds in
the repo markets, which would play a crucial factor in causing the events leading up to the
crash; during that period, the repo rate spiked above 8%.

The U.S. unemployment rate was 3.6 per cent at the end of 2019, the lowest unemployment
rate since World War II. And though the unemployment rate will decrease dramatically
between 2009 and 2019, income inequality will continue to increase. The United States
Census Bureau announced in September 2019 that US wealth disparity had reached its
highest level in 50 years, with the Gini coefficient rising from 48.2 in 2017 to 48.5 in 2018.
Despite its low joblessness, the ISM Manufacturing Index fell below 50% in August 2019,
hitting a low point of 48.3% in October of that year these would stay under 50% in the
months following the crash.

Ref

2020 stock market crash. En.wikipedia.org. (2020). Retrieved 30 May 2020, from
https://en.wikipedia.org/wiki/2020_stock_market_crash.