What Caused The Great Depression Essay
The Great Depression lasted was a major depression that started in 1929 and ended in 1939. When it first started, it was solely American. As time went on, with the United States in a depression, the other countries began to slowly fall into a depression as well, making the Great Depression a worldwide depression. The banks closed down, unemployment was at an all-time high, with states averaging 20 percent. Some states had very high unemployment, such as Ohio with a 50 percent unemployment rate and Toledo with an 80 percent unemployment rate. The Great Depression was said to have been caused by many factors, including maldistribution of purchasing power, credit structure, international trade, and lack if diversification (Unfinished Nation, pg.
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Some of these factors include farm foreclosures, consumer credit, and the banks in the market. These three factors were also related to one another in a way. The consumer credit influenced the farm foreclosure because since farmers were in debt and they could not pay off their debts, they had to foreclose their farms and go to other cities and states to try and find jobs to sustain their families and themselves. Farm foreclosures influenced the banks in the market because the farmers could not pay off their debt and when the banks came around demanding them to pay their debts, they could not and had to foreclose and the banks could not get any of their money back. Consumer credit affected the banks because the people kept spending money they and the banks did not have. When the banks called for the loans to be repaid, the people could not repay the banks and the banks went bankrupt or closed. It did not help that the banks did not reduce the debts of the European nations that allied with the United States after the war. Because the United States did not reduce the debts, the European nations took out more loans to repay the debts, basically repaying debts with debts. With each and every one of the factors, the Great Depression was created and prolonged, and the United States will never be the
Some of these factors include farm foreclosures, consumer credit, and the banks in the market. These three factors were also related to one another in a way. The consumer credit influenced the farm foreclosure because since farmers were in debt and they could not pay off their debts, they had to foreclose their farms and go to other cities and states to try and find jobs to sustain their families and themselves. Farm foreclosures influenced the banks in the market because the farmers could not pay off their debt and when the banks came around demanding them to pay their debts, they could not and had to foreclose and the banks could not get any of their money back. Consumer credit affected the banks because the people kept spending money they and the banks did not have. When the banks called for the loans to be repaid, the people could not repay the banks and the banks went bankrupt or closed. It did not help that the banks did not reduce the debts of the European nations that allied with the United States after the war. Because the United States did not reduce the debts, the European nations took out more loans to repay the debts, basically repaying debts with debts. With each and every one of the factors, the Great Depression was created and prolonged, and the United States will never be the