What Are The Long Term Causes Of The Great Depression

The Great Depression was in 1929, it was the biggest and longest economic collapse. The Great Depression occurred because of two long term causes. The two long term causes of the Great Depression were the stock market and banks. The Stock Market was one of the long term causes because people were constantly speculating the Stock Market and buying on Margin. This was a big contributor to the Great Depression because when you speculate the Stock Market you constantly buy your stock then sell it right away which is breaking the rules of the stock market; as well as losing that companies a lot of money. Also people were buying on the Margin, buying on margin is when you pay for ten percent of the stock and the bank pays for the rest and you make payments to eventually pay them back. The problem with this is people who bought on Margin couldn’t afford to pay the banks back, and when you put money in a bank they loan it to someone who buys on margin else in
The second long term cause of the Great Depression was because of banks. Banks lost a lot of money, as well as lost people there life savings. The bank lend money to people who bought on margin which caused a domino effect. It caused a domino effect because the people who bought on margin could not afford to pay the banks back, which meant the people who put money into the banks did not get there money back. The bank lost so much money they closed and since the bank's closed no one could loan money to business and when this happens the economy crashes. These were the long term causes of the Great Depression. The New Deal was a success because of two key programs Franklin Delano Roosevelt created, the first one was the Federal Deposit Insurance Corporation and the other one was the Social Security