The closing days of the 1920’s were a start of what would be the worst economic disaster that had ever been witnessed. The effect that the Great Depression had on capitalist countries such as Germany and the United States, was that their stocks and shares heavy economy plunged, leaving businesses unable to trade, and poverty throughout the nation. In the case of France, the depression initially did not suddenly bring the economy down drastically as it had to the more industrialised nations. Although relatively unscathed at first, by 1931 the ripple effect had hit France which steamrolled the economic downturn of the French economy. With France following the gold standard, the economic downturn lasted much longer than other affected nations. The lack of international trade between nations caused by protectionism, effected the revenue that the French economy needed to recover fully from the end of World War one, and during the era of The Great Depression.
The end product of the Treaty of Versailles was that Germany was primarily responsible for the destruction of the war, and was enforced to pay reparations in which France benefitted financially. In 1932 Germany was again no longer able to pay these reparation payments, and reduced the payments from thirty-eight million marks, to a minor three million marks (Bury, 1969, p.271). Also the effects of the German extremes of socialist and communist influences left France contemplating that “The problem of disarmament was going to be still more difficult” at a time when France was really struggling in the economic crisis (Bury, 1969, p.272). Following the boom in worldwide economies rising in the aftermath of World War One, France experienced a rise in the value of the Franc with GDP incr...
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...es of economic crisis, but being the lesser industrialised nation, it experienced a much longer period of depression in comparison to Germany and the USA. The issue of protectionism throughout the world during The Great Depression resulted in France using their own resources for themselves which in effect left a revenue gap, which was previously filled with exportation of produce.
Bibliography
Bury, J (1969). France 1814-1940. London: Methuen & Co LTD.
Jackson, J (1988). The Popular Front In France. Cambridge: Cambridge University
James, H (2003). Europe Reborn A History, 1914-2000. Harlow, Essex: Pearson Education Limited.
McMillian, J (2003). Modern France. Oxford: Oxford University Press
Tint, H (1970). France since 1918. London: B.T.Batsford Ltd.
Journals-
Beaudry, P. (2002). The French Depression in the 1930s. Review of Economic Dynamics. 5 (1), 73-99.
Kindleberger, Charles P. The World in Depression, 1929-1939. Vol. 4. Berkeley: University of California Press, 1986.
"Unit 11 The 1930s: The Great Depression." Welcome. New Jersey State Library, 12 Jan. 2011. Web. 17 Apr. 2014. .
At the end of World War One, Germany was required to pay a large sum of money to the Allies consequently resulting in the German Depression. The sum Germany had to pay was set after the Treaty of Versailles was enacted at approximately six billion, six hundred million – twenty-two billion pounds, (World War Two – Causes, Alan Hall, 2010). The large amount of reparations that Germany had to pay resulted in a depression and angered the Germans because they thought it was an excessive amount of money to pay, (World War Two – Causes) The Germans hatred of the Treaty of Versailles was of significant importance in propelling the Nazis to power. Germany could not pay their reparations and was forced into a depression, (World War II – Causes). The Treaty of Versailles deprived Germany of its economic production and its available employments, (World War II – Causes). The German Depr...
Folsom, Burton. "Which Strategy Really Ended the Great Depression?" : The Freeman : Foundation for Economic Education. N.p., 24 Aug. 2011. Web. 12 May 2014.
The first factor in the start of the Depression was the lack of diversity in the American Economy. It relied strongly on only a few basic industries, notably the construction and automobile industries. In the 1920's those 2 industries began a rapid decline: construction became scarce and fell from 11 billion to under 9 billion between 1926 and 1929. The automotive industry fell more than one third in the first nine months of 1929. Second, there was a maldistribution of purchasing power, and as a result a weakness in consumer demand. As major industries increased, the percent of profits going to consumers was to small to create adequate market for the goods the economy was producing. A third major problem was the credit structure of the economy. Farmers were greatly in debt, and crop prices were extremely low. Small banks were in trouble, many customers defaulting on their loans. Big banks were in trouble as well, many investing recklessly in the stock market then losing it all when the stock market crashed in 1929. The fourth factor was Americas position in the international trade market. In the late 20's, Europe's demand for American goods began to decline, partly because their industry was becoming more productive and partially because their economy was destabilized from the international debt structure that emerged in the aftermath of WW1. The international debt structure was a fifth and final factor contributing to the Great Depression. At the end of the war in 1918, all the European nations that had been allied with the US owed large sums of money to American banks and could not repay them with their shattered economies. The reparation payments were needed greatly from Germany and Austria, yet they were no more able to pay than the Allies were. This caused American banks to begin making large loans to European governments which they used to pay off their earlier loans, really only piling up debts. The collapse of the international credit structure in 1931 was one of the reasons the Depression spread to Europe.
In addition, having lost the war, the humiliated Germans were forced by the Allies to sign the Treaty of Versailles in 1919 that officially ended World War I. According to the harsh terms of the treaty, Germany had to hand over many of its richest industrial territories to the victors, and was made to pay reparations to the Allied countries it devastated during the war. Germany lost its pride, prestige, wealth, power, and the status of being one of Europe's greatest nations. (Resnick p. 15)
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:
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,
October 29th, 1929 marked the beginning of the Great Depression, a depression that forever changed the United States of America. The Stock Market collapse was unavoidable considering the lavish life style of the 1920’s. Some of the ominous signs leading up to the crash was that there was a high unemployment rate, automobile sales were down, and many farms were failing. Consumerism played a key role in the Stock Market Crash of 1929 because Americans speculated on the stocks hoping they would grow in their favor. They would invest in these stocks at a low rate which gave them a false sense of wealth causing them to invest in even more stocks at the same low rate. When they purchased these stocks at this low rate they never made enough money to pay it all back, therefore contributing to the crash of 1929. Also contributing to the crash was the over production of consumer goods. When companies began to mass produce goods they did not not need as many workers so they fired them. Even though there was an abundance of goods mass produced and at a cheap price because of that, so many people now had no jobs so the goods were not being purchased. Even though, from 1920 to 1929, consumerism and overproduction partially caused the Great Depression, the unequal distribution of wealth and income was the most significant catalyst.
The Great Depression was a period from October 29, 1929 to around 1940, close to when the U.S. entered World War II. This period was an economic depression that was started by the Stock Market crash. Such a catastrophic time span has many different causes that can all relate and combine. The Great Depression had many underlying causes that started originated after World War I. A series of events, including the economic boom of the 1920’s were contributors to the Great Depression.
The Great Depression was a period, which seemed to go out of control. The crashing of the stock markets left most Canadians unemployed and in debt, prairie farmers suffered immensely with the inability to produce valuable crops, and the Canadian Government and World War II became influential factors in the ending of the Great Depression.
There are several causes of the Great Depression which Michiel Horn touches on throughout his writings. The initial tool that he used to help understand the situation was to look at statistical data from that time. Through use of this data, a greater understanding of the physical hardships could be quantified and compared to present day. The reading begins with statistics about the shocking rate of unemployment. In 1933, at the height of the depression, the unemployment rate was between 19.3and 27 percent. The industrial activity in 1933 was only 57 percent of the average activity for the years 1925-29. The causes for the Great Depression were easy to see, but hard to fix. The problems included the inability of foreign countries to purchase surplus goods produced by other countries. Before the Great Depression, the British used this tactic to stabilize the market. Unfort...
Marking a significant beginning stage of the economic downturn was the Seven Years’ War, a battle that saw few positive achievements, but several losses both in terms of land and money, which had been acquired through loans that would establish France’s first significant debt. The reign of Louis XVI would further this debt, while also creating a greater divide between the estates of France by placing the heavy burden of repaying much of the new debt on the poorest class of France, the Third Estate. Participation in another war, only ten years prior to the French Revolution would create even more debt for France as they entered the American War of Independence, again with funding from loans that would need to be paid soon thereafter. Throughout this period of debt creation within France, society worsened in many ways due to the inability of the nation, from royalty to the Third Estate, to evolve economically, socially and agriculturally. With this overall sense of decline throughout France, a nearly unanimous desire amongst France’s Third Estate, the most populous, was to pa...
By 1929, the U.S. economy was in serious trouble despite the soaring profits in the stock market. Since the end of WWI in 1918, farm prices had dropped about 40% below their pre-war level. Farm profits fell so low that many farmers could not pay their debts to the banks; in turn this caused about 550 banks to go out of business. The nations illusion of unending prosperity was shattered on Oct. 24 1929. Worried investors who had bought stock on credit began to sell it. A panic developed, and on October 29, stockholders sold a record 16,410,030 share. By mid-November, stock prices had plunged about 40%. The stock market crash led to the Great Depression, the worst depression in the nation’s history (until…2014 ☺). It was a terrible price to pay for the false sense of prosperity and national well being of the Roaring Twenties.