Which were the main causes of Great Depression in American Economy?
THE GREAT DEPRESSION IN AMERICAN ECONOMY, ITS CAUSES, THE PATH TO RECOVERY
The Economic depression in the US had been a deepest and a long lasting slowdown of the US Economy. The great depression followed with crashing of the stock market in October 1929.
In 1929, the United States economy hit a major hardship that we now know as the Great Depression. After the stock market crash in October, the crisis began and our country’s business activity was at a concerning low. This economic catastrophe plummeted the family income in the years to follow. Aside for just the economy itself, the Great Depression had a major impact on the farming. Families turned to farming as a major way to cope with the tragedy.
In economics,a depression occurs when curves on all graphs such as prices, wages, employment,investment and international trade continuously head downwards. One of the worst economic depressions that stretched worldwide took place in the early 1930 's. While there is not one solitary cause for the occurrence of the Great Depression, there were a variety of factors that lead to the economic downfall. A few of these reasons were the stock market collapse, the mass production and under-consumption that took place,and the maldistribution of income. Unfortunately, due to the economies of the world being so interdependent, an economic depression in one area would have consequences in the other economies as well. While the more industrialized nations
The Depression affected the varying economic and social classes in different ways. The experience of the Depression obviously had a negative impact on the country as a whole but some groups of society were still able to flourish. In addition to economic and social class, geographic location also played a role in experience of Americans during the Depression. Those unlucky citizens that lived in the Great Plains states were also dealing with the effects of the Dust Bowl during this time. Some citizens were lucky enough to find themselves working in Depression proof jobs such as the cigarette and shoe manufacturing industries (Kennedy, p. 163). However, most people had to adjust to a new norm of searching for subsistence level or even lower wage jobs and struggling to find food and shelter. The plight of families, factory workers, farmers, businessmen and minorities alike was well documented during the Depression and their experience reflects one of the darkest periods in American history.
THE GREAT DEPRESSION AND ITS EFFECTS
The Great Depression which began in 1929 and lasted until about 1939 was an economic breakdown in America. Western industrialized world had its deepest and long-running economic downswing in their history. The stock market going under, structural weakness of the economy, excessive production, the gaps between rich and poor and an international crisis triggered the Great Depression in the United States.
During the late 1920s the United States was going through an economic depression that was caused by the failure of the stock market. When the stock market crashed, millions of people lost their savings, jobs and also their homes. About millions of people end up traveling across the country in order to find a job to help them to support their family. After becoming the president, Franklin D. Roosevelt want to help the country by stopping the depression and it too never occur again in the United States.
America underwent a massive economic downturn in the 1930's. This period was coined the Great Depression, because it was the "longest, most widespread, and deepest depression of the 20th century" ("Roosevelt and the New Deal”). Its devastating effects could be felt nationwide- unemployment rose to 25%, crop prices fell, and over 4000 banks closed or suspended operations. Community soup kitchens offered thin porridge and stale bread to desperate men willing to wait...
During 1928, the stock market continued to roar, as average price rose and trading grew; however as speculative fever grew more intense, the market began to fall apart around 1929. After the stock market crash, a period began that lasted for a full decade, from 1929 to 1939, where the nation plunged into the severest and the most prolonged economic depression in history - the Great Depression. During this inevitable period, the economy plummeted and the unemployment rate skyrocketed due to poor economic diversification, uneven distribution of wealth and poor international debt structure.
The economy during the thirties was very bad in America. At the end of the last century, in 1929, the stock exchange crashed. It is referred to as the Wall Street crash and the collapse of the NY stock exchange, but most importantly it started the Great Depression. Every day there were more bankruptcies and layoffs. Even big, seemingly indestructible companies were in danger. Companies like Industrial Steel. They had to lay off 225,000 workers. The Great Depression hit everywhere and everyone. There was no food and no money. People rushed to the banks to get their savings, but there was no money to get. Nine million savings accounts were wiped out. Bank failures crushed tens of thousands of people. Everyone was selling all they had. Half the families in the United States were facing eviction. Four million United States families were without means for one year after the crash. Hoovers theology was that if America was left alone, it would right itself. So he did nothing. When Roosevelt became president, he closed down all the banks and rushed them two billion dollars, then reopened them. Roosevelt, although this was not enough to fix what the crash had done to America, attempted to bring America back from the brink.
Who: the entire United States
What: the bottom fell out of the market, and shareholders frantically tried to sell before the prices plunged. 16.4 billion shares were dumped that day. People who bough stocks on credit were stuck with huge debts, and others lost most of their savings.
Why: because panicked investors unloaded their shares at the same time
When: October 29, 1929 (by mid November investors lost about $30 billion)