Causes of the Great Depression
The Great Depression was the worst economic collapse in the history of the industrialized world that affected everyone from children to elders. The social values of consumerism and isolationism that impacted the way that average Americans behaved was a huge part of what caused the collapse of the global economy. The stock market crash of 1929 set off the Great Depression. Economists also blame the overproduction and underconsumption of consumer goods and food. The doubtful state of the foreign balance and the world’s economy played a role in provoking the collapse as well. The Great Depression was launched due to a chain reaction of social causes, over speculation in the stock market, overproduction and underconsumption of goods, and weak foreign economies.
Following the Great War, many young Americans had a new goal of enjoying life to the fullest. This was apparent in the new Jazz Age fashions, music, dancing, and the way Americans elected to spend their money. This new concept of living in the present meant that Americans failed to plan for the future. As advanced technologies were invented, people felt that these luxurious items were necessities. Hence, consumerism became a social value for young Americans. According to the Cultural Causes of the Great Depression article given in class, American spending increased by 50% in the decade, while American incomes only heightened by 12%. Installment plans such as buying on credit allowed consumers to enjoy the luxury item immediately and worry about making payments later, even if the goods were unaffordable. Another social and cultural trend during the post-war was isolationism. Isolationism is the policy of staying apa...
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...f isolationism that came from nativists was activated in the United States. The blocked international trade contributed in forcing some countries to economically retaliate against America’s nation. Thus, all of the causes and issues previously mentioned connect together into a flowing timeline.
All in all, the Great Depression occurred as a result of the link between the different sources that all led up to this massive downfall. Social causes and values from consumerism and isolationism weakened the economies of different nations. The stock market crash that came from over speculation affected the wealth of many Americans. Not only that, overproduction and underconsumption from the United States and other foreign nations impacted the economy and trade as well. As you can see, there were many economic factors that contributed in setting the gruesome Great Depression.
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