...Brieal McClung Watson U.S. History 10 October 3, 2014 After the Roaring 20’s, came the long-lasting, terrifying, Great Depression. The Great Depression lasted from 1929-39. A decade of economic downfall, stock market collapses, and bank failures. The Depression is well-known to this day, and has changed how the U.S. Federal Reserves system works also. The stock market had a huge role in causing the Great Depression. It all started on a day, called Black Tuesday. On that Tuesday, October 29th, 1929, the steepest drop in the stock market happened. The stock market lost $15 billion. During that month, Americans lost a total of $30 billion, averaging up to each american working a year for free. When stock markets have a decrease in price, it is called a Bear market, which is what was going on during the depression. Before that, the roaring 20s, the markets were having a Bull market, meaning prices of the stocks were increasing, and people were gaining money. People were buying on the margin, meaning that they were paying the margin and borrowing the balance from a bank. Another cause of the Great Depression was the banks. They were making poor investments. All during the 1930’s there were over 9,000 banks that closed. They had a bank run, meaning that they panicked and ended up closing because they had no more money. People went to the banks to take out all of their money they had in the banks because of the stock markets crashing and they needed/wanted all of their cash...
Words: 517 - Pages: 3
...The Great Depression of 1929 which originated in the United States of America was one of the worst times for the history of the USA’s economy.It started by the end of 1929 and lasted till 1933. It started as a recession which was getting worse and industrial output in the USA decreased by 47% and Gross Domestic Product fell by 30%(Duignan3 ). Unemployment had increased more than 20% at the worst times of the depression that lasted until 1933. The Great depression spread to almost every country in the world, ranging from Europe to Latin America and Asia. The causes of the great depression had been very controversial among scholars who studied that period. Ben Bernanke has said before, “to understand the Great Depression is the Holy Grail of...
Words: 1714 - Pages: 7
...The The Great Depression of the 1930’s was a worldwide phenomenon composed an infinite number of separate but related events. The Great Depression was a time of poverty and despair caused by many different events. It’s hard to say what caused this worldwide depression because it’s all based on opinion as opposed to factual data. There are many contributing factors but not one specific event can be pin pointed for starting the depression. It is believed that some events contribute more than others-such as the Stock Market Crash of 1929. The Stock Market Crash of 1929 was in the majorities opinion, a long and overdue crash that was bound to happen. Prices sky-rocketed so high that when they reached what was believed to be it’s all time high,...
Words: 692 - Pages: 3
...Starvation, homelessness, and unemployment were just some of the devastating components of life that many people across the globe suffered through as a result of the longest lasting economic downturn in history. This was also known as the Great Depression. The Great Depression caused worldwide panic to every country and continent in the world, hitting the United States and Germany the hardest. Overproduction, the stock market crash, and the weak banking systems led to a crisis that immensely impacted the way people had to live their everyday lives. Many factors played a role in triggering the start to the Great Depression, which can be considered one of the darkest times in American history. One of the most influencing factors was the vast amount of economical resources being made that weren’t being sold at the rate they were being produced. Both farmers and factories were producing much more goods than the people were able to afford. This was known as overproduction. By 1929, worker input increased by 32 percent allowing manufacturing companies to soar. ("Causes of the Great Depression." Great Depression and the New Deal Reference Library. Ed. Allison McNeill, Richard C. Hanes, and Sharon M. Hanes.) During this time, more suburban families had access to electricity and automobiles causing the demand to rise immensely. In turn, farmers produced more goods to meet the demand. With the overabundance of new consumer products and farm goods such as wheat and meat, prices began...
Words: 1384 - Pages: 6
...year is 1930, during the Great Depression. Some of the main reasons why the Depression is so very important, is because without this, we might not have had the incentive to work so hard to make things better afterward. The society of America is amazing, the people that put forth the time and the effort to make a nation thrive, ought to be remembered proudly and courageously. The Great Depression was a time of sadness for our nation, a pedestal, that stood in our way of greatness. Great Depression Causes It started out as people were being run out of jobs, forced to feed their families off of the streets, with only the kindest hearts. This was labeled the Stock Market Crash, which would prove to be a tremendous factor...
Words: 2249 - Pages: 9
...Another one of the main causes for the Great Depression was due to the high tariffs and war debts. Many European nations owed billions of dollars to the United States. These nations that were so far in debt were impacted so strongly by World War I that they had no way of paying back their debt. The United States insisted the debt be paid off. The allies then demanded that Germany pay them through the Treaty of Versailles. This led to financial crisis when Europe couldn’t purchase goods from the United States. The United States also passed the Fordney-McCumber Act in 1922, which put high tariffs, or tax, on industrial products that were imports. This angered the other nations and they retaliated which led to a decline in world trade which was a major contributor to the Great Depression. A decline in world trade leads to a decline in Real GDP and this is bad for the economy. Overproduction in industry also played a pivotal role in the Great Depression. While factories were producing mass amounts of products, wages were not increasing at the same pace. Due to low wages and overproduction, workers could not afford to buy all of the factory output. The United States tried to sell the surplus of goods overseas, but the high tariffs and lack of money in Europe did not support this solution. An additional overproduction also occurred in the agriculture and farm industry. The average income for farm families was about a third of what average American families were...
Words: 377 - Pages: 2
...Great Depression The Great Depression was caused by the stock market crash in October of 1929 which sent Wall Street into panic and millions of people went into debt and caused them their lives. According to America in color 1930’s, in the year 1929 the United States bank lost 80 million dollars of the people’s money. By 1933 over 15 million people were unemployed and nearly half of the nation’s banks had failed. “The only limit to our realization of tomorrow will be our doubts of today.” - Franklin D. Roosevelt. The Great Depression is an immense tragedy that took millions of people in the United States from work. It marked the beginning of the most depressing time in the history of the States. After almost a decade of being in the dark,...
Words: 469 - Pages: 2
...In the sad, tedious days of October 1929, one of the longest economic hysteria’s began that changed the world today as we know it. Starting in the United States, and later on engulfing nations worldwide, the Great Depression that up rose, began the biggest market crash in history. It began in the 1930’s and lasted until 1941, when defense spending began to simulate the economy. This recession was far from “great”, it held many people out of jobs, many families without food and shelter, and many businesses bankrupt. Many historians and scholars still argue to this day what really cause the Great Depression, but it always ends up back to the main cause being the stock market crash of 1929. Although, many other financial factors played into account of the causes of the Great Depression....
Words: 550 - Pages: 3
...After World War I, the United States began to bounce back from war slowly, but the other European countries apart of the alliance did not bounce back like the United States. This led to the United States loaning money to these European countries in order to help build their economy. This resulted in the United States being tied to world's economy. Once it was determined that the European countries could not pay back the United States as quick as it needed to be, then the start of "The Great Depression" began. As many would speculate the stock market would fall as result of the United States' banks not being paid back by other countries. By 1929 the stock market crashed greatly, and the national crisis became a global crisis. President Hoover...
Words: 303 - Pages: 2
...In 1929, the Great Depression had come to a start. Many of the kids in the town of Illinois were saddened , as well as their parents were too. You never saw a person smile, or saw people in a happy mood. Most of the adults were being laid off, everyone was losing money due to the crash of the stock markets. People were starving, and tired. Everyone was so hungry that they could eat a horse. More than 3.2 million people were unemployed, most of these people were trying to sell apples on the street, each apple for only 5 cents a piece, which is not a lot of money. A small boy named Kyle Robinson, or otherwise known as Cooking Kyle was the only person that you would see smiling even in the worst of these times. The Great Depression didn’t really...
Words: 460 - Pages: 2
...Analyzing the Causes and Solutions of The Great Depression The Great Depression was a disastrous time for not only Americans but for many people across the entire world. The depression was felt in a great deal of places, from both North America, South America, all the way to Europe, and even Japan. From cotton farmers, commonly known as “Okies”, to bankers in the big city, everyone felt the impact from the depression (Smiley, 2008, p.1). Although economists argue the main causes of the Great Depression, there were many different contributing factors that led to the worst financial crisis in America’s history. As the depression wore on many politicians and economists attempted to solve the problems facing Americans. It is important to remember what had caused the Great Depression as well as what brought the country back. A look into our past can possibly help to prevent future disaster facing our economy. The most commonly known factor leading to the Great Depression was the crash of the United States stock market. Although the stock market crash of 1929 is seen as the starting point of the Great depression, there were a number of causes beforehand that lead to the event that is now known as Black Thursday. The 1920’s had experienced a tremendous surge in stock prices. The Federal Reserve could not justify these prices by future earnings and in 1928 the Federal Reserve raised interest rates in order to slow rising stock prices (Pells, 2012, p.4). These higher interest...
Words: 2695 - Pages: 11
...Causes of the Great Depression The causes of the Great Depression according to Eric Foner are numerous. One of them that Foner mentions in his book titled, Give me liberty!: an American history was the 1929 incidence of the stock exchange and unequal distribution of wealth . Foner affirms that the stock market crash caused stockholders to suffer enormous losses of more than forty thousand billion dollars. Although the stock exchange began to recoup but the consequences overwhelmed the recuperation process and proved worthless. Secondly, the closing of banks was another factor that contributed to the loss of reserve funds. Failures by the financial institutions caused more than nine thousand bank to fizzle amid the 1930s. The problem of failing...
Words: 619 - Pages: 3
...because it is too expensive to eat. Imagine your aunts, uncles, mom and dad getting laid off from their jobs because the company can’t afford to pay their workers. Imagine trying to take money out of your bank account and they tell you their all out of money. All those issues occurred from the Great Depression. The buying on credit was a long term cause of the Depression. Since the 20’s was a period of great economic boom, not many people took the future into consideration. Many people bought expensive luxury items using money they did not have. Installment buying allowed people to make a monthly, weekly, or yearly payment on an item that they wanted or needed. Buying on credit and installment buying left millions of people in debt. Also, the continuous scamming in the stock market caused a loss of a lot of money. Buying on margin was a problem because people would only pay 10% and borrowing the rest from the bank. In 1928 Herbert Hoover was elected for president, when the Great Depression hit he did nothing about it. He thought it wasn’t the government’s problem and the people had to deal with it themselves. His approach was “rugged individualism” which means just waiting the depression out, he was a proponent...
Words: 660 - Pages: 3
...The Great Depression The economy of America faced a very hard time when the stock market crashed on October 1929 during the presidency of the 31st president of the United States of America, Herbert Hoover, who claimed that it was all caused by World War One. Mentioning the name, the first thing that comes to mind is the Great depression during which an enormous downfall happened after the wonderful years of prosperity. It was hard to believe how in a blink of an eye the situation rapidly changed. In the beginning of the 1930s, over 13 million people were unemployed. The whole nation came to a standstill. President Hoover, a republican, refused to intervene and instead, let the free market deal with the problem and the economic downturn morphs...
Words: 1238 - Pages: 5
...The Great Depression was a dark time in American History and the world when many Americans lost their jobs and went into economic troubles. It all started when the stock market crashed in October 29, 1929, also known as Black Tuesday. The crash caused all the banks to fail and unemployment rates to rise. The rich were not affected as much as the poor were because the rich did not have to look for jobs to earn money since they already had enough of it. The poor had to starve because they could not afford to get food for their families. Many families struggled in the Great Depression due to money issues, Marriages were delayed, the men had abandoned their wives, and there were high divorce rates (By the time of Franklin Roosevelt's inauguration)....
Words: 863 - Pages: 4
