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The Main Causes Of The Great Depression

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The great depression officially began in Wall Street October 29, 1929 – 1933, and was an economic slump caused by a collapse in the stock market. When the stock market crashed, the stock prices dropped fast and there was little hope for recovery. This lead to panic among the people and all tried to sell their stock at the same time, but this was useless since nobody wished to buy the stock. Therefore, the stock market became the path to bankruptcy. Thousands of Americans lost their job and were forced into poverty. As a result, most people had to travel to earn money. They either hitchhiked or “rode the rails” from different towns, cities and states in search for a job to feed their families or just themselves. (John, -) (Mitchener, -) (Pierce, -) The cause of the depression started with World War I that caused inflation, because of huge debts and increased money supply. Firms earned a lot more during the 1920s and reinvested this into expansion, by 1929 they had expanded to the breaking point. When the stock market crashed, banks all over America were forced to close because they had invested their client’s savings in the stock market. People were afraid to lose their savings, and quickly tried to withdrawal their money, but such a massive withdrawal of money would force more banks to close. Industries cut back on wages, employees …show more content…

Through a special session with the Congress, later named the Hundred Days, he wanted to relive the depression by passing laws. He made this happen through a program called the New Deal. The laws established by this new program had three main purposes. First purpose was to provide for the needy. Second purpose was to aid recovery by giving jobs and form a bond between government, businesses and consumers. Third purpose was to make sure such a destructive depression never would happen again, by reforming business and

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