What Events Led To The Great Depression
What conditions and events led to the Great Depression?
Thesis (Argument Statement)
The Great Depression of the 1930s was caused by overproduction of goods by businesses into an economy that already had severe problems with speculation in the stock market and inequalities in wealth. Early, government intervention that decreased international trade only added to this problem.
Outline
The Great Depression
The Great Depression was the worst and longest economic recession in the history of the world economy. The Depression started in 1929 and continued until 1939. This economic disaster affected Western industrialized economies but its effect extent across other nations. The Great Depression began in the United States, which faced its worst effects. …show more content…
However, some claim that the Depression began about 10 years earlier in Europe but the United States expected that it was resistant to such a downturn. Consequently, the Unites states government at that time did not prepare policies and methods to safeguard that the country did not experience the same meltdown as Europe.
Conditions that led to the Great Depression
The Great Depression in America began with over production and low prices in the agriculture.
The country was well progressed in technology and farmers increased their production levels. Prices fallen due to increased supply and followed by a drought. Farmers could no longer pay their loans and certain banks closed down. The American economy policy in the 1920s was laissez faire and this led to imbalanced distribution of wealth. The rich controlled major sources of income and became richer. There was a major decrease in spending. Global policies in Europe and America that reinforced an increase in tariffs got international trade to a standstill.
Nations that owed America billions of dollars could not honor their debts because of the effects of the depression. Despite these events, Americans continued to invest comprehensively in the stock market, which Marks its highest in 1929. A decline began soon after and on 24th October 1929, investors started to sell millions of shares in fear as the decline continued. The stock market crashed on 29th October 1929 (Black Tuesday) and investors and banks lost billions of dollars. The subsequent economic downturn lasted for 10 years and spread to other economies especially America’s trade
partners.
The Effects of the Great Depression
The effects of the Great Depression were more severe in America but it felt across all worlds. Investors in the stock market could not pay their loans. People demanded their deposits from banks in panic and as a result, there was less money in flow. Government’s struggles to reverse the resulting deflation did not yield results. Companies closed down because of low demand while some laid down thousands of their workers. Consequently, unemployment rate increased. Real estate properties lost value. Investors in real estate could not pay their mortgages. Banks reclaimed their properties, which were worthless because no one could afford to buy them anyways. Over nine thousands failed closed down. Nations had to implement major changes in their macroeconomic policies and establishments to recover from the Great Depression.
Thesis (Argument Statement)
The Great Depression of the 1930s was caused by overproduction of goods by businesses into an economy that already had severe problems with speculation in the stock market and inequalities in wealth. Early, government intervention that decreased international trade only added to this problem.
Outline
The Great Depression
The Great Depression was the worst and longest economic recession in the history of the world economy. The Depression started in 1929 and continued until 1939. This economic disaster affected Western industrialized economies but its effect extent across other nations. The Great Depression began in the United States, which faced its worst effects. …show more content…
However, some claim that the Depression began about 10 years earlier in Europe but the United States expected that it was resistant to such a downturn. Consequently, the Unites states government at that time did not prepare policies and methods to safeguard that the country did not experience the same meltdown as Europe.
Conditions that led to the Great Depression
The Great Depression in America began with over production and low prices in the agriculture.
The country was well progressed in technology and farmers increased their production levels. Prices fallen due to increased supply and followed by a drought. Farmers could no longer pay their loans and certain banks closed down. The American economy policy in the 1920s was laissez faire and this led to imbalanced distribution of wealth. The rich controlled major sources of income and became richer. There was a major decrease in spending. Global policies in Europe and America that reinforced an increase in tariffs got international trade to a standstill.
Nations that owed America billions of dollars could not honor their debts because of the effects of the depression. Despite these events, Americans continued to invest comprehensively in the stock market, which Marks its highest in 1929. A decline began soon after and on 24th October 1929, investors started to sell millions of shares in fear as the decline continued. The stock market crashed on 29th October 1929 (Black Tuesday) and investors and banks lost billions of dollars. The subsequent economic downturn lasted for 10 years and spread to other economies especially America’s trade
partners.
The Effects of the Great Depression
The effects of the Great Depression were more severe in America but it felt across all worlds. Investors in the stock market could not pay their loans. People demanded their deposits from banks in panic and as a result, there was less money in flow. Government’s struggles to reverse the resulting deflation did not yield results. Companies closed down because of low demand while some laid down thousands of their workers. Consequently, unemployment rate increased. Real estate properties lost value. Investors in real estate could not pay their mortgages. Banks reclaimed their properties, which were worthless because no one could afford to buy them anyways. Over nine thousands failed closed down. Nations had to implement major changes in their macroeconomic policies and establishments to recover from the Great Depression.