The Great Depression
When a person hears the words “The Great Depression,” almost everyone thinks of the worst economic times in the United States. The Great Depression started in the late 1920s and continued on until the early 1940s. It is known as being “the deepest and longest-lasting economic downturn in the history of the western industrialized world” (History.com). We can learn from the occurrences during The Great Depression that government involvement is the deciding factor of whether an economy will expand or continue to shrink during a recession.
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.
As you can see, the United States of America has changed greatly since the Great Depression. Our idea of what we need and what is poor has changed greatly since this period. This twelve year time period shows how things can change, and how people can adapt to economic crisis when they are forced to. Without our fall, other countries may have experienced this. So, this period of American history still serves as a lesson today. As quoted by many people, ?If we do not know our history, we are destined to repeat it?. In conclusion, you can see the Great Depression caused great calamity and sorrow, but in the end, it was one of the best learning experiences the United States has ever seen.
After the great depression back in the 1930’s, America would think they would never run into an economic scare again, until 80 years later when the next big economic disaster would strike. The 2008 economic collapse would not only be triggered and felt by America, but the entire globe as well. You would think that the United States would have a fail-safe plan on defending off another economic crash, but they didn’t and had shown weakness. The 2008 economic collapse is usually refereed to as the global financial crises or the great recession. With the allegation of collapse from large financial institutions, and the bailout of banks by the government, began the second great depression. Many believe that we are still stuck in this recession and have not completed anything to get out of this situation that’s affecting our nation. I believe that the economic crash in 2008 was the finale building block towards a more structural society, political system, and government in the United States of America.
Since being founded, America became a capitalist society. Being a capitalist society obtains luxurious benefits and rather harsh consequences if gone bad. In a capitalist society people must buy products and spend money to keep the economy balanced, but once those people stop spending money, the economy goes off balance and the nation enters a recession. Once a recession drastically takes a downturn, the nation enters what is known as a depression. In 2008 America entered a recession and its consequences were severe enough for some people, such as President Barack Obama, to compare the recent crisis to the world’s darkest economic depression in history, the Great Depression. Although the Great Depression and the Great Recession of 2008 hold similarities and differences between the stock market and government spending, political issues, lifestyle changes, and wealth distribution, the Great Depression proved far more detrimental consequences than the Recession.
The Great Depression and the Great Recession were very similar to each other. First of all, both were preceded by good economic times. Between 1921 and 1929, the annual real economic growth was at 4.4%, and between 1982 and the 2000s, the annual real economic growth was at 3.2%. This is just one similarity of the two arduous times. Another similarity is that both were preceded by the innovations in consumer finance. In the 1920s, consumer credit was used exorbitantly, and in the 2000s, banks heightened real estate lending and securitization of mortgages. Lastly, both eras were followed by a time where the Federal Reserve was highly valued. The Great Depression and Great Recessions were different in some ways too. The Great Depression lasted 10 years, whereas the...
The Great Depression
At the end of the 1920s the world experienced a devastating economic depression that struck countries with market economies. Despite the great depression being mildly experienced in some countries, the United States of America was hit so mind-bogglingly that at its nadir in 1933 an approximate value of 25% of all workers and an overwhelming 37 % of all non-farm workers were completely out of work and thrown to the curbs. The book Great Depression: People and Perspectives that is written by Hamilton Cravens gives us a peek of the tribulations suffered and encountered by individuals during the trying times of the Great Depression. It showcases the adverse level of suffering experienced, enlightening the sad misfortunes faced by individuals, instances where some individuals starved to death with their loved ones helpless and instances where many others lost their treasured homes and farms. It paints a pictures of homeless vagrants niggling onboard freight trains that crossed the nation for lack of the necessary funds (Cravens, 2009).
The Great Depression was the most catastrophic economic disaster in American history, and was highly avoidable. Although it may have caused many horrific events to happen, the depression was a valuable lesson to America and the entire world. Now, we know to avoid outrageously high tariffs, extreme deflation, excessive “credit buying”, and innumerable loans. But we still haven’t evolved out of our greedy, dense minds.
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:
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.