The Great Depression : Severe Economic Crisis

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The Great Depression was a severe economic crisis that began after the stock market crash in 1929. Afterwards, laws were put into place to prevent the depression from happening again. The Great Depression had a major impact on the economy and the people who experienced the event. The people began to buy products only when the money was available, and became conservatives for the remainder of their lives. The United States was pushed into having a better economic system because of the Great Depression. Previous to the Great Depression, the governments usually took little or no action in the times of the downturn of businesses, instead they relied on neutral market forces to attain the necessary economic corrections.Yet, market forces had…show more content…
The crash of the stock market in October brought the economic expansion of the 1920s to an emblematic end. Wall Street’s tremendous crash caused billions of dollars in equity to dissolve into thin air. On October 24, 1929 a reported 12.9 million contributions were exchanged and that day became known as “Black Thursday”. On October 29th agitated traders sold off 16,400,000 shares of stock, this became known as “Black Tuesday”. The government came to a realization that investors in the markets had lost approximately 40 billion dollars. Millions of the shares that had been bought ended up becoming worthless, investors who had bought the stocks “on margin” had been wiped out entirely. Farmers couldn’t afford to harvest the crops and were then forced to leave them in the fields to rot. Millions of people ended up losing jobs and businesses and many farmers went bankrupt. Wages fell and the buying power decreased for those who were fortunate enough to remain employed. Many American that had been forced to purchase on credit ended up falling into debt and foreclosures and repossessions steadily increased. The Depression hit the hardest for the nations that had been most greatly indebted to the United States, Great Britain and Germany were among these nations. Unemployment increased sharply for Germany in late 1929, by early 1932 unemployment had reached 6
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