Cousative Factors Of The Great Depression

The Great Depression was an economic downturn in America that lasted from 1929 until about 1939, making it the longest lasting depression ever experienced by the industrialized world. The stock market crash caused a chain reaction that involved problems such as unemployment, deflation, an increase in debt, and general poverty for lower class citizens. Attempts at escaping the depression weren’t altogether successful. In fact, most of the efforts resulted in high consumer debt as well as over optimistic loans given to the public by banks and business investors. The Depression caused severe political changes in the US as well as its obvious economic failures. After three years of the depression, Herbert Hoover lost the presidential election

Businesses were greatly affected by The Great Depression. As banks started shutting down the whole American economy started experiencing deflation. Deflation is when money starts to have less value. Because of this, businesses began to cut costs meaning they would need to lay off workers. The workers being laid off can't buy anything so companies can’t sell anything. This results in the company eventually having too much inventory which they cannot sell. The companies would then have to resort to reducing their prices to sell all their stockpiled products. This causes profits to drop, making companies lay off more workers, repeating the cycle again and eventually lead to the company going bankrupt.

The Great Depression was an economic collapse that began in 1929 and ended in 1938. During the Depression most citizens went through hardship .Three main causes of the Great Depression were the stock market crash of 1929, the Dust Bowl, and Bank failures.

One would say that the Great Depression is one of the darkest times in American history. The Great Depression did not only affect the United States, but also other countries who were heavily invested in the United States, such as Germany and Great Britain. Following the crash of the stock market in 1929, the level of unemployment skyrocketed and economies around the world plunged. The United States faced those dark years until about the later part of the early 1930s, when things start to head in an upward trend. Some of this success could be contributed to Franklin D. Roosevelt’s implementation of the New Deal in an attempt to restore confidence in the economy, and the political system. Ultimately, it would still take years until the world economy and especially the United States economy was anywhere near its pre stock market crash levels. The success of the New Deal was short lived when the economy started to take a turn downward in the late 1930s, because FDR could not get enough demand to successfully implement his New Deal. In 1939 there was another positive trend with the beginning of World War II. Although the New Deal helped to restore confidence in the economy and the political system, nevertheless it was the spending of World War II that ended the Great Depression, because it lowered the level of unemployment, increased productivity, and helped to boost the United States economy upward, although capitalism still survived.

In 1929, following the stock market crash on Wall Street, the United States entered an era known as the Great Depression. For the next years to come, it would be characterized by high unemployment rates and low rates of investment. Desperation levels rose to a level of panicked hysteria, and in 1932 Franklin Delano Roosevelt was elected president with promises of relief, recovery, and reformation. He called this the New Deal, and it forever altered the role of the government in the everyday lives of American people with programs still in effect today. However, the previous belief of the New Deal ending the Great Depression is under debate as historians dive deep into the past. Due to statistics of unemployment and the unforeseen results of the programs it implemented, it is plausible to state that the New Deal was not successful in solving the main issues of the Great Depression.

The 1930s were a time of hardship for the citizens living in The United States. The Dust Bowl and The Great Depression brought on many substantial consequences that affected many family’s lives entirely. The Great Depression was mainly caused by the stock market crash of 1929. Banks lost all of their money, therefore people were not able to retrieve the money that they had deposited in the bank. The Dust Bowl was a decade long dust storm that brought up farmland and carried it with the winds of the storm. Before the Dust Bowl, the farms had stripped the farmland of the moisture by over using the land, and when the drought came the land became especially susceptible to the winds that came shortly thereafter. The Dust Bowl and the Great Depression made thousands of people in the U.S. unemployed, the typical family dynamic changed, and people lost homes.

In September 1929, the stock market fell sharply, causing a large panic among stockholders. Scared, they withdrew their stocks for huge losses and in one day investors lost up to 15 billion dollars in one day collectively (p. 902). Word of the stock market crash spread around the country and the fear of nothing returning to normal spread like wildfire. Many investors who lost their fortunes killed themselves, causing more of the “depression factor” to kick in. Another crucial factor in the cause of the Great Depression, was the overproduction of goods but the under consumption of those same goods by consumers.

When the citizens had bought all that they could buy, there was a decrease in demand. Suddenly, the industries had an excess of goods and no one to sell it to. At this point, the Fordney-McCumber Act began to cripple the economy of America. Other nations introduced high tariffs to boost their revenue and to spite the United States. Sadly for the United States, these high tariffs and low demand were instrumental in the depression that America experienced. When the stock market crashed on October 29th, 1929 or “Black Tuesday”, the united states, along with other nations were in economic turmoil and the widespread prosperity of the 1920s ended abruptly. The depression threatened people's jobs, savings, and even their homes and farms. During the heart of the depression, over one-quarter of the American population was out of work. For many Americans, these were extremely hard times. When Roosevelt was voted into office, he introduced the New Deal. While this plan tried to help the united states out of it’s isolationist rut, the second world war was the final solution. Mobilizing the economy for world war finally cured the depression. Millions of men and women joined the armed forces, and even larger numbers went to work in well-paying defence jobs.

In the 1920s, American economy had a great time. The vast majority of Americans in 1929 foresaw a continuation of the dizzying economic growth that had taken place in most of the decade. However, the prices of stock crested in early September of 1929. The price of stock fell gradually during most of September and early October. On “Black Tuesday” 29 October 1929, the stock market fell by forty points. After that, a historically great and long economic depression started and lasted until the start of the Second World War. The three causes of the Great Depression are installment buying, uneven distribution of wealth and the irrational behavior in the stock market.

In the 1930’s the great depression started when the stock market stopped a lot of people soon became in debt and also jobless, later the dust bowl caused a lot of people from the midwest and migrate to california to find jobs.The Dust bowl destroyed all the crops in the midwest and also took all the great soil out of land, and killing the animals because of the dust in the air, making the land in the midwest look like a desert. Farmers were devastated so the farmers who had no land and no crops had to migrate to California to find jobs to get money for their families to live.

In reaction to this, other nations stopped buying American-made goods and the United States’ economy floundered because of this.

America’s Great Depression is believed as having begun in 1929 with the Stock Market crash, and ending in 1941 with America’s entry into World War II. In order to fully comprehend the repercussions and devastating effects of the Crash of 1929, it is important to examine the factors that contributed to the catastrophic event which led to The Great Depression. The Great Depression was the worst economic slump in U.S. history, and it spread to most of the industrialized world. Many factors played a role in bringing about the depression; however, the main cause for the Great Depression was the combination of the greatly unequal distribution of wealth throughout the 1920s, and the

The single most important factor that led to the great depression was government misunderstanding of economics and the affects of economic implementation. Our economy had experienced many panics and recessions up to 1929 and recovered without the level of intervention of the 1930’s. Governmental tools such as monetary policy, fiscal policy, taxation, and tariffs were used with the reverse of the intended affects and prolonged the depression. The Federal Reserve’s restrictive policies contributed to the depth and length of the depression after the second wave of bank failures in 1931 and the Fed’s 936-1937 policies contributed to the 1938 recession (Hughes & Cain 2011, p. 488). The taxation and tariff policies stifled economic growth and consumption.

The Great Depression is a defining moment in time for not only American, but world history. This was a time that caused political, economical, and social unrest. Not only did the Great Depression cause a world wide panic, it also caused a world wide crisis unlike any before it. This paper will analyze both the causes and the effects of the Great Depression in the United States of America.

There are various factors that led to the Great Depression. To begin, the lack of bank regulation was a big factor. The Federal Reserve Act which made banks have money on reserve, was not enforced. Another big factor was easy credit, Easy credit made it easy for people to get money out the bank without having the money to pay it back. Furthermore, the reduction in purchasing across the board can easily be said to be another key factor. With the stock market being down many people within every social class stop purchasing items. Which would cause a decreased not only the number of items being purchased but also the loss of people jobs. Many people had thing on layaway, so usually they would just pay for it monthly. However once they lost their