The Key Causes Of The Great Depression

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Recommended: American history of the Great Depression

The Great Depression was a rough time for millions of American people. The aftermath of the Stock Market Crash of 1929 left many hard working Americans unemployed and without any money, making it the most serious depression in American history. Although Americans were experiencing years of prosperous life prior to the crash, they did not expect a depression that would last ten years. The collapse of the economy eventually led to a rapid rise in crimes. Theft, prostitution, and alcohol related crimes began to increase with the recession. Unemployment and poverty were the key factors responsible for the crimes during the Great Depression. The Great Depression was triggered by a panic from the Crash of 1929. During this time stocks were becoming a trend for Americans who wanted to earn money by investing in companies they believed would do well in the stock market. Initially the stock market was doing great, as the value of companies’ stock went up, the more companies were invested in. Many of the Americans that participated in the stock market were beginning to blindly invest in companies that they knew nothing about. They assumed that the companies would do great, as they were successful in the market. The wealthy caused a problem in the market by pulling out their stocks as they got information that the stock value would …show more content…

A few low and middle class American’s wanted to participate in the market so they sought out loans from banks. Banks were more than obliged to give loans as long as they had collateral to offer the bank. Unfortunately, banks were accepting stocks as collateral from loaners. Little did the banks know that the Crash of 1929 would lead them to bankruptcy and cause a major loss for their clients. Banks were left with useless stocks and were unable to function properly as they did not have money to give to clients and the clients did not have money to pay back

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