File Name: great depression 1929 causes and effects .zip
The Great Depression was the worst economic downturn in the history of the industrialized world, lasting from to It began after the stock market crash of October , which sent Wall Street into a panic and wiped out millions of investors. Over the next several years, consumer spending and investment dropped, causing steep declines in industrial output and employment as failing companies laid off workers.
This was a significant event between two world wars.
Great Depression in the United States
A third of all banks failed. But there were also some beneficial effects. Overall, the Great Depression had a tremendous impact on nine principal areas. The economy began shrinking in August GDP fell Falling prices sent many firms into bankruptcy. It grew another
A third of all banks failed. But there were also some beneficial effects. Overall, the Great Depression had a tremendous impact on nine principal areas. The economy began shrinking in August GDP fell
The Great Depression was the worst economic downturn in the history of the industrialized world, lasting from to It began after the stock market crash of October , which sent Wall Street into a panic and wiped out millions of investors. Over the next several years, consumer spending and investment dropped, causing steep declines in industrial output and employment as failing companies laid off workers. Throughout the s, the U. The stock market, centered at the New York Stock Exchange on Wall Street in New York City , was the scene of reckless speculation, where everyone from millionaire tycoons to cooks and janitors poured their savings into stocks. As a result, the stock market underwent rapid expansion, reaching its peak in August By then, production had already declined and unemployment had risen, leaving stock prices much higher than their actual value.
The stock market crash marked the beginning of a decade of high unemployment , poverty, low profits, deflation , plunging farm incomes, and lost opportunities for economic growth as well as for personal advancement. Altogether, there was a general loss of confidence in the economic future. The usual explanations include numerous factors, especially high consumer debt, ill-regulated markets that permitted overoptimistic loans by banks and investors, and the lack of high-growth new industries. These all interacted to create a downward economic spiral of reduced spending, falling confidence and lowered production. Also hard hit was the manufacturing of durable goods like automobiles and appliances, whose purchase consumers could postpone. The economy hit bottom in the winter of —33; then came four years of growth until the recession of —38 brought back high levels of unemployment. The Depression caused major political changes in America.
Great Depression History
It lasted roughly a decade: from , the year the stock market crashed, to , when the US started mobilizing for World War II. Almost half of US banks collapsed, stock shares traded at a third of their previous value, and nearly one-quarter of the population was jobless — at a time when unemployment insurance didn't exist. While the stock market crash of marked the start of the crisis, it wasn't — contrary to popular belief — the sole reason for it. Many other factors combined to create the Great Depression, from ill-timed tariffs to misguided moves by the young Federal Reserve.
The Great Depression lasted from to and was the worst economic depression in the history of the United States. Economists and historians point to the stock market crash of October 24, , as the start of the downturn. But the truth is that many things caused the Great Depression, not just one single event.
I made it race against time. Once I built a railroad, now it's done. Brother, can you spare a dime? At the end of the s, the United States boasted the largest economy in the world. Upon succeeding to the Presidency, Herbert Hoover predicted that the United States would soon see the day when poverty was eliminated.
The depression was caused by a number of serious weaknesses in the economy. Although the s appeared on the surface to be a prosperous time, income was unevenly distributed. The wealthy made large profits, but more and more Americans spent more than they earned, and farmers faced low prices and heavy debt. The lingering effects of World War I caused economic problems in many countries, as Europe struggled to pay war debts and reparations.
We thank Steve Broadberry and Ken Wallis for helpful discussions. Christopher Adam, Ken Mayhew, and, especially, Christopher Allsopp made very thoughtful comments on an earlier draft. The usual disclaimer applies.
The Great Depression was the longest, deepest, and most widespread depression of the 20th century, put into motion after the devastating stock market crash in in the United States known as Black Tuesday. The Great Depression was a severe worldwide economic depression during the s. The timing of the Great Depression varied across nations; in most countries it started in and lasted until the late s.