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Q.

In the mid-1920s, many countries financed their investments through loans from the ____.


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Detailed Solution

Many nations used US loans to finance their investments in the middle of the 1920s. When things were going well, it was frequently very simple to raise loans in the US, but when things started to go downhill, US overseas lenders worried. The amount of US loans abroad in the first half of 1928 exceeded $1 billion. It was only a quarter of that amount a year later. Countries that were heavily dependent on US financing were suddenly facing a severe crisis. Much of the rest of the globe was impacted by the US pulling its loans.
 
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