Worst Economic Meltdown: The Great Depression
Prepared for
Lee Kuhnle
Instructor – ECON 3000-0LF
November 7th, 2014
Prepared by
Kamil Zora
Table of Contents
Introduction 3-4
Problems/Key Issues 3-4
Question Responses 5 Strategy for Changing Importance of Attributes 5-6 Strategy for Changing Brand Beliefs 6-7 Strategy for Adding a new Attribute. 7-8
Evaluation of Marketing Tactics 8-9 Reccomendations 9-10
References 11
Appendix 12
Introduction The Great Depression was the longest lasting and most devastating recessions to ever happen in the history of the world. The reach of its affect included everyone from individuals,
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People had their livelihoods completely changed in a matter of days. Unemployment in 1929 was at a healthy 3.5% and in 1933, reached an all time high of 25%. This recession was like no other, fueled by a variety of factors such as: the inattention and lack of analysis to the prior bank failures that were multiplying by the year , "Worse was to come. Bank failures came in waves. The first, in 1930, began with bank runs in agricultural states such as Arkansas, Illinois and Missouri. A total of 1,350 banks failed that year." issues with the gold standard, the Smoot-Hawley tariff and Tax increases that were counter reactions that failed by the Hoover Administration, and the stock market …show more content…
Banks were failing by the thousands and the federal reserve had failed to acknowledge this failure prior to the depression. Many of these banks were local banks that were lenders to the people in their areas. This wave of bank failures was an early indication that a huge recession was about to hit the economy. These banks that had previously failed prior to 1929 were all local banks which serviced people in their local region, the failures were getting stronger and stronger and banks had to shut down because of the lack of confidence in the system and major bank runs. In 1929, 650 banks were reported shut down, by 1933, 4000 banks were out of business. Americans were living on credit they did not
In the Roaring Twenties, people started buying household materials and stocks that they could not pay for in credit. Farmers, textile workers, and miners all got low wages. In 1929, the stock market crashed. All of these events started the Great Depression. During the beginning of the Great Depression, 9000 banks were closed, ending nine million savings accounts. This lead to the closing of eighty-six thousand businesses, a European depression, an overproduction of food, and a lowering of prices. It also led to more people going hungry, more homeless people, and much lower job wages. There was a 28% increase in the amount of homeless people from 1929 to 1933. And in the midst of the beginning of the Great Depression, President Hoover did nothing to improve the condition of the nation. In 1932, people decided that America needed a change. For the first time in twelve years, they elected a democratic president, President Franklin D. Roosevelt. Immediately he began to work on fixing the American economy. He closed all banks and began a series of laws called the New Laws. L...
In 1932 and 1924 over in Germany hyperinflation took hold and the country had trouble paying the reparations it had been ordered to pay after world war one. The shortage of cash meant that there was less money to be spent on industrial and farm products. By 1932 most banks in the United States were closed. The slump led to a massive unemployment of 14 million in the United States. In the United States drought and dust storms hit parts of the Midwest and southwest.
The Great Depression was most likely the most severe and enduring economic crashes in the 20th Century (Source 1). That included a quick drop in the supply and demand of goods and services along with a big rise in unemployment (Source 1). Many things were the cause of the Great Depression, one is the U.S. stock market crash (Source 1). And two is the widespread failure in the American bank system
The shares values had fallen and this left people panicking. Many businesses closed and several of the banks did not last because of the businesses collapsing. Many people lost their jobs because of this factor. Congress passed Roosevelt’s Emergency Banking Act, which helped reorganize the banks and closed the ones that were insolvent. Then three days later he urged Americans to put their savings back in their banks and by the end of the month basically three quarters of them reopened. Many people refer to the Banking Act as the Glass Steagall Act that ended up prohibiting commercial banks from engaging in the investment business and created the Federal Deposit Insurance Corporation. The purpose of this was to get rid of the speculations in securities making banking safer than before. The demand for goods were declining, so the value of the money was
When the stock market crash of 1929 struck, the worst economic downturn in American history was upon Hoover’s administration. (Biography.com pag.1) At the beginning of the 1930s, more than 15 million Americans--fully one-quarter of all wage-earning workers--were unemployed. President Herbert Hoover did not do much to alleviate the crisis.(History n.pag.) In 1932, Americans elected a new president, Franklin Delano Roosevelt, who pledged to use the power of the federal government to make Americans’ lives better.
The Great Depression was in no way the only depression the country has ever seen, but it was one of the worst economic downfalls in the United States. As for North America and the United States, the Great Depression was the worst it had ever seen. In addition to North America, the Depression greatly affected Europe and other various countries throughout the world significantly during the 1920’s and 1930’s. The Great Depression was caused by the collapse of the Stock Market, which happened in October of 1929. The crash exhausted about forty percent of the paper values of common stocks. It was the worst depression due to the fact that at the time of the Great Depression the government involvement in the economy was higher than it had ever been. A unique government agency had been set up exclusively to prevent depressions and their related troubles for instance bank panics. All of ...
Great Depression was one of the most severe economic situation the world had ever seen. It all started during late 1929 and lasted till 1939. Although, the origin of depression was United Sattes but with US Economy being highly correlated with global economy, the ill efffects were seen in the whole world with high unemployment, low production and deflation. Overall it was the most severe depression ever faced by western industrialized world. Stock Market Crashes, Bank Failures and a lot more, left the governments ineffective and this lead the global economy to what we call today- ‘’Great Depression’’.(Rockoff). As for the cause and what lead to Great Depression, the issue is still in debate among eminent economists, but the crux provides evidence that the worst ever depression ever expereinced by Global Economy stemed from multiple causes which are as follows:
A result of the Stock Market Crash of 1929 was many, many bank failures. These banks failed because, the Stock Market Crash of 1929 was the cause of debt and poverty for many people. People had no money to pay back the banks, and no money to deposit into the banks. Whatever money was left in the banks got withdrawn because people were afraid that they would lose it, just like others lost all their money to the market crash. By 1933, 11,000 of America’s 25,000 banks had closed and weren’t in existence
The Great Depression was a heavy economic depression in the decade before World War II. An economic depression is defined as a substantial and sustained shortfall of the ability to purchase goods relative to the amount that could be produced using current resources and technology.[1] The Great Depression affected most national economies in the world throughout the 1930s.
In 1929, A Yale University Economist Irving Fisher stated. " The nation is marching along a permanently high plateau of prosperity".(5) 5 days later the stock market crashed and the worst economic downturn in American history called the "Great Depression" began. The Depression started in 1929 and would last for a decade until we entered War World II. The Great Depression affected every part of economy and no job was safe. In 1929 unemployment was at 1.5 million and by 1933 unemployment reached over 13 million which meant 1 out of 4 were out of work (3). Some who were successful businessmen before the stock market crash and now selling pencils or apples on the street corners after the crash .Many business closed their doors, factories shut down and banks failed causing homelessness, poverty and general despair on many Americans. Huge numbers of Americans had their lives upset by the Depression. Tens of thousands of migrant farm workers traveled the nation looking for employment. Farming income fell some 50 percent and people went hungry because so much food was produced that production became unprofitable. Many Americans watched their homes and life savings be lost because of the stock market. Confidence in the market was lost and without that confidence investors pulled out and the market collapsed.(4)
The Great Depression was one of the greatest challenges that the United States faced during the twentieth century. It sidelined not only the economy of America, but also that of the entire world. The Depression was unlike anything that had been seen before. It was more prolonged and influential than any economic downturn in the history of the United States. The Depression struck fear in the government and the American people because it was so different.
Banks all around, especially the large ones, sought to support the market before it could crash down. As the stock prices crashed, banks struggled to keep their doors open (“Economic Causes and Impacts”). Unfortunately, some banks were unsuccessful. Customers wanted their money out from their savings account before it was gone and out of reach, leaving banks insolvent (“Stock Market Crash of 1929”).
Great innovations in productive techniques during and after the war raised the output of industry beyond the purchasing capacity of U.S. farmers and working force. As a result of this, unemployment skyrocketed during the years of the Depression, reaching levels as high as one third of the population. Almost half of the commercial banks of the United States failed during the Depression. Crop prices fell by over fifty percent. People went hungry because so much food was produced that production became unprofitable. Others were unemployed because they had produced more than could be sold. Hundreds of thousands roamed the country in search of food, work, and shelter.
The Great Depression was the biggest and longest lasting economic crisis in U.S. history. The Great Depression hit the United States on October 29, 1929 when the stock market crashed. During 1929, everyone was putting in mass amounts of their income into the stock market. For every ten dollars made, four dollars was invested into the stock market, that's forty percent of the individual's income (American Experience). during 1929 the stock market was the best way to make money, most of american population invested in the stock market, and back then the government assured people it was the best time to buy houses since the stock market was booming.
The Great Depression was the deepest and longest-lasting economic downfall in the history of the United Sates. No event has yet to rival The Great Depression to the present day today although we have had recessions in the past, and some economic panics, fears. Thankfully the United States of America has had its shares of experiences from the foundation of this country and throughout its growth many economic crises have occurred. In the United States, the Great Depression began soon after the stock market crash of October 1929, which sent Wall Street into a panic and wiped out millions of investors ("The Great Depression."). In turn from this single tragic event, numerous amounts of chain reactions occurred.