New Business And Production Methods

A sharp recession took place in the nation in early 1913 that marked the end of a cycle

Following the economic boom of the 1920s, there was a period of economic depression. The United States and its citizens were greatly affected. There were many economic problems that occurred such as unemployment rate rising tremendously and many more. Herbert Hoover and Franklin D. Roosevelt were presidents during that time and dealt with the economic problems. They helped create programs to financially stabilize the country again. The Great Depression ended when the United States entered World War II.

First, we need to understand how the Great Recession occurred. It all started with President Ronald Reagan in the 1980s. Reagan was famous for his supply-side economic views (Amadeo 1). He used top-down economics meaning he used government intervention to give businesses tax breaks and subsidies to create economic growth. With this he also started a continuing phenomenon to deregulate Wall Street. He believed this would create vast economic growth and it did. But it created a bubble and it

Money markets slammed on October 1929 and this is what caused the Great Depression to happen. For a length of time the country was at the point where signs of troublesome were shown such as joblessness; which turned out to be a gigantic issue for the Americans as well as for different nations. “By 1933, unemployment was at twenty-five percent” (FDR). Never had the highs been higher and lows been lower for the economy. With cash going away individuals started to live in hardships with no real way to earn money. Hoover being president at the time, had great hopes for the economy of America, once this catastrophe hit he was not necessarily blamed for the troubles happening. The nation reacted to The Great Depression in many ways. People were let down by President Hoover which effected the economy, children began to impact society, and families fell apart. Some people turned to music, while others turned to violence.

After the Civil War, America started experiencing prosperous times in terms economic boom. However, in September, 1929 things took a different twist when the stock prices fell abruptly, eventually leading to the stock market crash the following October. This, combined with rising personal debt triggered the Great Depression, the worst economic collapse since the onset of industrialization. The ensuing effect was collapse of banks, closure of businesses and a quarter of the employed Americans lost their jobs. Further, families became homeless and some resorted to camping out on the Great Lawn in New York City, which was an empty reservoir then.

The success of the economy introduced “mass culture”. Thing’s like “ready to wear” clothes and radio’s were becoming more and more common. Within 3 years of the first commercial radio station airing, there were 500 stations and radios in more than 12 million homes. The automobile industry entered the mainstream in 1924 when Ford came out with the Model T for just $260, and they were very generous with credit, so that more families could afford them. By 1929, there was one car on the road for every 5 Americans. However In 1929, the stock market crashed and lost billions of dollars, which started The Great Depression. It is the longest lasting economic downfall in history. By 1933, nearly 167 banks closed and 30% of the workforce was unemployed. President Franklin D, Roosevelt lessened the effects of the great depression greatly however it wasn’t until 1939 that the economy started to turn back

When the Great Depression came in 1929, the economy went crashing with the people and the stock market. Franklin Delano Roosevelt, the president at the time tried to help the people and tried to bring the economy back up which did happen many years later. They had laws passed and programs to give men, women, and children hope that the all of their problems will be gone. Their laws and programs were very successful because they did accomplish one of the goals that was presented , they gave the people money and jobs and they were able to make the people trust that the government had come back into the full potential that it had once

In the 1920s America was at its best and almost everyone was enjoying life. Business were doing well and people had extra money and time to spend freely during Coolidge's presidency. Years later it became the total opposite when the stock market crashed and President Hoover had no answer or response to this problem. People were poor and unemployment rate was rising fast. After Hoover left office President Roosevelt came in with a plan and a will to restore America with his new deal and other ideas The government played large and small roles in the economy during the 1920’s-30s from Coolidge, Hoover, and Roosevelt.

During the Great Depression they had the Dust bowl that caused a big change for them. THe Recession had the housing bubble it was also called the National Housing Act that was passed by Congress in 1934 and set up the Federal Housing Authority (“HUD.Gov by the U.S. Department of Housing and Urban Development”). This agency encouraged banks, building and loan associations, etc. to make loans for building homes, small business establishments, and farm buildings. If the FHA approved the plans, it would insure the loan (“National Housing Act by John Simkin”). The Most of the borrowing that took place during the housing bubble was mostly mortgage debt. Low interest rates and the expanded availability of mortgage loan especially “subprime” mortgages which extended credit to borrowers with weak financial records—made home ownership more attractive and attainable for millions of Americans. With the expectation that home prices would keep rising, people not only bought more houses, they also bought bigger houses and accelerated renovations of existing homes (“Cause the great depression by Muddy Water Macro”) .The recession was an economic downturn which means nothing was an order doing this time.

As the economy began to boom, a change in the way society lived had also changed. Instead of living in large cities, citizens began moving outward in the urban areas further away. Although most of the urbanization movement can be contributed to the raise in population, there were also many other changes that were occurring. Stagecoaches began having more frequent routes to all of the major cities and also most of the smaller outlying cities.

Recession cycles are thought to be a normal part of living in a world of inexact balances between supply and demand. What turns a usually mild and short recession or "ordinary" business cycle into an actual depression is a subject of debate and concern. Scholars have not agreed on the exact causes and their relative importance. The search for causes is closely connected to the question of how to avoid a future depression, and so the political and policy viewpoints of scholars are mixed into the analysis of historic events eight decades ago. The even larger question is whether it was largely a failure on the part of free markets or largely a failure on the part of government efforts to regulate interest rates, curtail widespread bank failures, and control the money supply. Those who believe in a large role for the state in the economy believe it was mostly a failure of the free markets and those who believe in free markets believe it was mostly a failure of government that compounded the problem.

Another recession occurred in 1990 and when congress came up with a plan to simplify unemployment, President George H.W. Bush vetoed it and thats when the country decided on Bill Clinton for President as the economy was in financial crisis. With Clinton new to office, their administration benefited from technology innovation and low energy prices. During this this time unemployment dropped, the deficit was shrinking and they were handling free trade which in turn helped encourage Wall Street. People felt comfortable with the economy and in turn their was a lot of government and consumer

unemployment sky-rocketed. With people willing to work for less money—than companies were currently paying, wages lessened too. Farmers and workers did not

Increased incomes, along with the introduction of credit funded a huge increase in consumer spending. Only some of the increased affluence found its way into insurance as a provision for retirement.

The 1920’s was a time of economic prosperity for the United States, however, no one knew that an economic apocalypse was about to unfold. With the end of WWI, the United States became a consumer economy, meaning that they were no longer producing war goods and were replaced by the production of consumer goods. The economy and the Stock Market were very strong and prosperous thanks to the switch in economy. President Calvin Coolidge (who became president after President Warren G. Harding died in office) believed in a policy of “laissez faire” which means the government cannot interfere with business, essentially making businesses in control of themselves. The economy of the U.S. was flourishing, but multiple factors including supply-and-demand, credit, and bankruptcy lead to it all crumbling apart. Notable causes of the Great Depression were that people did not pay back their loans causing the banks to lose money, laissez faire economic practices, and overproduction, which lead to Franklin D. Roosevelt’s New Deal Program ending the Depression. Without the New Deal, the United States would still be at risk of another Depression and would not be fully recovered from the first one.