Why Did The Great Depression Start Essay

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It is a common misconception that the Great Depression began with the stock market crash in 1929. While the stock market crash is a contributing factor, it is not in fact the cause of the Great Depression. In actuality, The Depression began because of many inept government and banking systems; these systems led to a complete and total collapse in the world and market trade. The question is, how did the depression start, and why was no one able to stop it?
To begin with, the United States economy in the 1920’s was not exactly perfect. When many think of the twenties they think of flappers and Champaign, many would call it the Roaring 20’s. This was a time when domestic consumption was at an all-time high, this means that Americans were spending more and had the extra cash to spend. This is why many see the 1920’s as a time of prosperity and wealth. With optimism in the air, people decided to invest their money in the stock market. World War Two had just ended and people were very enthusiastic about Americas future, and more specifically, its economy. People were literally scrambling to get into the stock market; it was seen as the ultimate method to get rich quick. People were so confident in the stock markets never-ending rise in prices that many people didn’t consider the risk that …show more content…

Farms in America had greatly expended during the First World War because the soldiers needed food. To help produce more food, many farmers started to by mechanisms like tractors. In the 1920’s tractors were highly expensive, so many farmers ended up in debt that they were often foreclosed upon. Farm prices continued to drop because of overproduction and low rates. Yes, a lot of people lost money in the market, but the stock market crash and the Great Depression should not be confused as the same thing, so many other factors contributed as well. Not everything in life is so black and white, no matter how badly we wish it

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