Causes of The Great Depression

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Imagine a society where over 25% of the population was unemployed. That is what it reached during The Great Depression (“The Great Depression”). During the depression unemployment rates were the highest they have ever been. It is highly speculated to this day on what exactly caused The Great Depression. Most historians agree it was a chain of events, one after another, that brought our country into chaos. Some events were more impactful than others. These events caused pandemonium among the public, which blew it even more out of proportion by trying to save themselves from bankruptcy. The three major events that caused The Great Depression were the Stock Market Crash of 1929, the bank crisis, and public overreaction. Although it is a semi-popular idea, it is too simplistic to view the Stock Market Crash of 1929 as the sole cause of the great depression. The “Roaring 20s” was a period of time where business was booming. Companies were expanding exponentially with the new nation growing. Eventually, businesses were expanding faster than the demand was growing so it was a bubble just waiting to burst. Corporate profits were skyrocketing, while wages increased incrementally, which widened the distribution of wealth. By concentrating the wealth into fewer hands it limited economic growth (“Economics Essays: Causes of Great Depression.”). Middle class families were introduced to installment plans, where you could buy something and pay for it later on. This led them to believe they could afford items that they could not, so they weren’t able to pay off their items. This was similar to the problem banks created by being to lenient handing out loans. The stock market during this time was doing extremely well. It was... ... middle of paper ... ...sed one another and ultimately lead to the worst depression in American history. The depression had been building up for years and wasn’t avoidable when looking at it in hindsight. We corrected the problems to help avoid this from occurring again in the future. Works Cited Ganzel, Bill. "Bank Failures during the 1930s Great Depression." Bank Failures during the 1930s Great Depression. N.p., 2003. Web. 04 May 2014. Pettinger, Tejvan. “What Cause the Wall Street Crash of 1929?” Economics help. N. p., 05 Nov. 2012. Web. 03 Mar. 2014. Sen, Daniel J. “Stock Market Crash.” PBS. PBS, n. d. Web. 01 Mar. 2014 Unknown. “Economics Essays: Causes of Great Depression.” Economics Essays. N.p. 28 Sept, 2012. Web. 04 Mar. 2014. Unknown. “The Great Depression.” Independence Hall Association, n. d. Web. 03 Mar. 2014.
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