What Caused The Great Depression

10 years, two months, and two days ago, the stock market collapse. Excessive amounts of stock was traded and billions of dollar were lost, effectively sending us into a downward economic spiral we call the Great Depression. By 1933, half of all American banks had failed and the unemployment rate soared. It is generally agreed upon that excessive and improper use of credit, overspeculation in the stock and real estate markets, grossly high tariffs (which cut off international trade), and return to the gold standard are the primary causes for this economic failure. Yet why is it this bad? This country has faced multiple recessions in its history like the Panic of 1819, the Panic of 1873, or even the most recent recession we faced from about 1920-1921, but none of these had the catastrophic effects on American life and business that the Great Depression has had. Many argue that the government did not “do enough” to help the people and economy out of the Depression. However, the government’s meddling and interference in the free market inhibited the ability for the American capitalist economy to recover itself.
Whenever the economy looked like it was slowing down, the Fed put in more credit and capital, but when left to itself, the free market will allow interest rates to give the economy balance to avoid synthetic prosperity and deep despair. So when the Fed manipulated rates, no necessary corrections took place in the market, setting the economy up for failure. The stock market was completely over-valued and many people had taken out loans that they could not repay-the market crash in October of 1929 was