The Depression was a period of time after the economic boom of the 1920's in America, when the economy went downhill. People lost money, jobs, shares, businusses went bankrupt and the farming industry suffered greatly. The Republic Government at the time lead by Hoover was still following policies of Lassez Faire so business was not getting the support it needed to get it back on track.
The Republic Governments Protectionist policies were one of the causes of the great depression. There were trade problems associated with their protectionist policies. The Republic Government made high tarrifs on imported goods. This was to make sure that the Americans were buying their own products. Buying American products meant that they would be keeping the money in their economy instead of sending it to other countries. Other countries, now unable to export goods to the Americans retaliated by increasing their tarrifs on american goods. America could no longer export their goods to other countries. Mass production meant that there was more goods being produced than what needed to be but because other countries had high tarrifs on American goods, they could not be exported. Output became greater than demand so goods cheapened in price. American goods were not being sold. This resulted in cut-backs in production which meant that there was less employment available so people lost their jobs. Profits being made lessened and so did the value of shares.
A lack of regulation in the stock market was also a cause of the great depression. Most shares that were changing hands were done so through borrowed money. Buying shares on the margin this way worked very well when share prices were rising. When prices began to slow down or cheapened in value however, trouble arose in the stock market. Seventy five per cent of share prices could be borrowed. This caused a lot of speculation which helped to increase share valuse further. The Federal Reserve Board gave easy credit to share holders and taxes were cut so that more money was available. This lack of regulation created more speculation which caused more share prices to increase.
The farming problems in the United States increased and were one of the causes for the depression. Because of mechanisation there was over production of goods by farmers. There were large surpluses of food. It could not be exported because of high tarrifs...
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...d unemployment was on the rise. people became homeless and had to live around the citys in slum areas they liked to call hoovervilles. suicide rose as a result of debts and the pressures being put on people who couldnt handle it. ill health rose as a result of poor hygene and living conditions. Elderly people were robbed of pensions and svaings and so had nothing to live for anymore.
Women before the depression had begun getting involved in the stock market. so during the depression they lost money like the men did. They were only a percentage of the people involved in the stock market however, it was mostly still men. Women also stopped buying as many labour saving devices during this time. African Americans during the Depression were mostly still working on farms. They suffered like the rest of the farming population with debts and surplus produce.
Hoover did not do all he could to stop the economic depression. he did what he believed in though, and he made attempts to get the economy back on track. He was only human in his actions, you can not do something if you dont feel it is right. and he was not going to help his nation if he thought he was going the wrong way about it.
The fundamental weakness and contradictions of the world economy was the actual cause of the Great Depression. The international economy was in shambles because of the cost of war and the American economy was indirectly damaged by this; however, October 29, 1929 is the official beginning of the Great Depression because of the stock market crash of 1929. Paper fortunes had vanished but money was the foundation of American life. People usually took loans from banks so they could start businesses but because of the Depression, they took out loans so they would have e...
In the 1929, The Great Depression was a worldwide depression that lasted for 10 years. The stock market crash of the 1929 causes the Depression, when loans were given out and people couldn’t repay the loan. It affect many American lives, the unemployment had skyrocketed from 3% to 25%. Work wages fell 42% for those who still had a job. The Great Depression lasted so long was because it affect a nationwide and people didn’t have money to spend to recover the economy
One main cause of the depression was the overproduction of farming and factory goods. The nation was so over-productive that its citizens couldn't afford to pay for these goods because all of the money was going into production fees, and not salaries When Hoover enacted the Hawley-Smoot Tariff, U.S. goods acquired an enormously high 60% tax rate, this was part of the reason for the depression, since no other countries wanted to pay the high tariff rate just to buy goods from the United States. While Hoover thought that he was helping the economy with this tariff, it turns out that all he did was isolate the U.S. from Europe and other parts of the world that would normally trade with the United States. President Hoover also thought that the government shouldn't give the citizens any direct help, when in fact, that was exactly what they needed to do. Instead of going out into the community and directly helping people, Hoover thought that if he created “public works” like the Hoover Dam, he could create jobs, and help citizens ...
They way people interacted with others changed in the Great Depression. One of the main changes is the way the family was run. During the glutted 1920s, the father is the support of the family while the mother do the housekeeping. When the great depression struck, the men lost their jobs. They can no longer support their families. Because of self pride, many fathers left their families and never came back because felt that they lost their purpose in the
There were many causes for the Great Depression. The first and one of the largest was the stock market crash. Before 1929 the stock market was flourishing and everyone wanted to buy stocks. People were so confident in the stock market that they were buying “on margin”, which meant that brokers would lend them 10% of the money they invested (D1). The problems began when stocks were being over speculated. When people began to realize this, they began selling there shares. On October 29, 1929, 16 million shares were sold (D9). This day became known as “Black Thursday”, the day the stock market crashed (D12). The second reason was the overproduction of goods. Factories had already produced too many goods and now there was no demand for them. The government began to raise tariffs to protect Canadian industries but things only led downhill from there.
Farmers were greatly affected by The Great Depression. In the early 1930’s prices dropped so low that many farmers went bankrupt and lost their farms (“The Great Depression hits farms and cities in the 1930’s”). The stock market crash prevented the farmers from being able to sell their produce (McCabe). Through the depression farmers were still producing more food than consumers were buy, and now the consumers could buy even less. Farm produce prices fell even lower (“The Depression for Farmers”). Some farm families started burning corn rather than coal in their stoves because the corn was cheaper (“The Great Depression hits farms and cities in the 1930s”). Non-farmers had also been hit hard by the depression. With the banks failing and businesses closing, over fifteen million people became unemployed (“The Great Depression”). The unemployment rate skyrocketed from three percent to nearly twenty five percent (McCabe). The Great Depression brought a rapid rise in the crime rate as many unemployed workers restored to petty theft to put food on the table. Suicide rates rose greatly as did recorded cases of malnutrition (“Social and Cultural Effects of the Depression”). More and more people were found standing in bread lines, hungry and homeless (McCabe). The depression affected people and businesses but many programs later America pulled out of their
conclude that the crash was not the sole problem of the depression. It changed the expectations of the future from once a positive view to a negative view. Many economists argued at the time that a sharp decline in international trade following 1930 helped worsen the depression. Many people have the misconception that the great depression was because of the great crash but that was only initially, many other things happe...
The Great Depression of 1929 effected not only the United States but foreign countries as well. It occurred because of the stock market crash and a drop in global trade, due to high taxes. From there on, there were programs put in place to help with the growth of the economy to come.
The occurrence of the Great Depression was an inevitable economic disaster that was caused by a variety of reasons and events that happened in the U.S. and across the world. The lack of diversification was one of the main causes of the Great Depression as the dependence on only certain industries like the automobile industry began years before; and because of the prolonged success of such industries, their demise could not have been predicted. World War I was an event that had a major impact on the Great Depression because of the complexity of the international debt owed to the U.S, and the decline of international trade. In addition, the failure of the bank system and the reckless investments that banks, businesses and the American public made contributed to the manifestation of the Great Depression.
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:
There were numerous causes and effects of the Great Depression. It was a divergent distribution of wealth. The nation’s wealth increased extremely but they did not distribute it evenly. The economy didn’t have any way of paying the money back. It created a financial crisis when Europe couldn’t purchase goods from the United States. It was mandatory for Germany to pay for World War I due to the Treaty of Versailles. This debt made the United States pass the Forney-McCumber Act which created high tariffs. There were a variety of reasons as to why the Great Depression started.
From 1920 to 1929 consumerism partially caused the Great Depression due to speculation and installment buying. Speculation is the act of investing in a stock with the hope of a big gain but the risk of a big loss. Many of the investors were sure that the stocks they were going to buy were going to grow, therefore they received big loans that, once the market crashed and all the money was gone, they could never pay b...
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.
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.