Due to the stock market crash, families became unable to pay for anything, allowing for the Great Depression
This being the cause of prices concerning stocks and shares to increase, to the point that it was nearly impossible to invest in the market. This being a factor in causing companies to terminate their employees swiftly, and if an individual remained employed, their wage decreased dramatically below the minimum wage. Many counterparts had invested in the stocks with loans or borrowed money, and when the market crashed, their share had been utterly wiped out, leaving them with absolutely no money. Individuals who had their money in banks, became skeptical of the banks and started to withdraw their money, to preserve their remaining savings. This, causing the banks to have to take out loans from bigger banks so that they could pay the individuals their money.
The crash of the stock market on October 29 1929 was one of the main causes of the Great Depression. Black Tuesday brought to an end the roaring twenties and its wealthy people with their successful plans to become millionaires. The Great Depression was one of the deepest long-lasting economic downturn in the western history. Economists have the theory that the Great Depression was caused because of the Law of supply and Demand miscalculation, Say’s Law misinterpretation and the business cycle not being a cycle but more like a roller coaster. Therefore the Great Depression was caused by people not being able to interpret how economics work.
The Great Depression was a complex event caused by a variety of factors. The six factors of the Run on the Banks, the Stock Market crash, the uneven distribution of wealth, problems for business and industry, problems for farmers, and the overuse of credit all played a role in the start of the Great Depression. All of these factors were an important factor in helping start the Great Depression. However, the overuse of credit was the most important factor of them all because it led to people relying on loans, too many payments for the consumer to adequately keep up with, and the economy eventually drying up once the influx of money stopped.
During the 20s, which became known at the Roaring 20s, American society was at an all time high and people were prospering as the nation’s wealth almost doubled and American was sent into the modern, consumer age. However following almost directly after the Roaring 20s, America entered a period of economic failure, also known as the Great Depression. During this period, the U.S faced economic, social, and political turmoil. The government and various individuals quickly sought after solutions to address the problems facing America during this time. Herbert Hoover, who was President at the start of the Depression, and his many reforms intended to revitalize the economy and create more jobs but would fail and his belief in rugged individualism
The Great Depression of 1929 was one of America’s most influential downfalls that crippled society for years. The depression caused many years of failure and poverty for almost all of society. The government’s role during these times was crucial and critical for turning around the economy. The depression had a major effect on government’s power and involvement with the people and states. The government was less involved before the depression.
With the reduction of general prices and the impact of of producers who use the input, the economy was struggling to survive. Millions of consumers out of jobs and unable to purchase goods, prices were deflating, and in major fluctuation will affect every citizen. After the stock market crash, nearly 10,000 banks had failed. When banks were first established, they had no type of insurance.
In 1929, the U.S. was hit with the worst economic crisis in the history of the country, the Great Depression. The Great Depression left millions of people unemployed and cost millions their life's savings. The Depression lasted for ten long years for the American people. Since the Great Depression ended, people have studied it, trying to figure out what happened that started it all. The problem was, in fact, the poor economic habits of the people at the time, such as speculation, income maldistribution, and overproduction.
The Great Depression of the United States was the worst economic collapse in history of the modern world. The 1920s were a time of prosperity and optimism. The feeling of victory the United States had after World War was largely present in society. Although there was a fleeting post-war recession in 1920 and 1921, figures such as average unemployment and the GNP show the extent of the prosperity. Unemployment never rose above 3.7 percent between 1922 and 1929, and the GNP rose $31 billion.
The cause of the Great Depression was how a lot of millionaires used their tycoons to cooks to janitors where it just went down in their savings. That’s when the stock market had crashed. A lot of banks had failed during the late 1920s and that is also a reason to why the stock market had crashed in the first place.
During the depression, there was not just one particular reason for the depression, yet there were several events that took place and led to the cause of this economic crisis known as the Great Depression. The stock market crashing, banks closed, the federal government reduced taxes, but the most important factor that affected the rise in stock was credit. When the banks cut back on lending things began to go downhill from there, areas began to see severe depression. The industrial areas also, they were beginning to slow down, so much of the boom was caused by the buying of goods, and the economy had come to a halt. Last, the reason was problems in Europe.
The Great Depression studded everyone politically. Before the Great Depression, the Federal Reserve tightened credit 5-10%, disabling the ability to liquidate loans. This resulted in a recession that was one of the many causes of the Great Depression (The Editors of Encyclopedia Britannica). The confidence in President Herbert Hoover’s idea of capitalism began to falter (Amadeo). In order to restore prosperity, President Franklin D. Roosevelt put in place the New Deal.
What caused the Great Depression was not only one thing that caused it there several causes. One of the most fundamental concepts in economics is the law of supply and demand if the supply of goods increases then the prices will drop. Another theory is say’s law where surplus will always disappear because prices will come down until everything gets bought. The Great Depression started from 1930 to 1940 before world war ll.
This would cause overproduction, bank failures, and a loss of jobs nationwide. In addition, there were many things that
The Great Depression There are many factors that led to the Great Depression. Some of the factors include the stock market crash, or the weak banking system. Other factors are like uneven incomes and over production in industrial and agricultural manufacturing that contributed to the Great depression. These factors combined led to the Great Depression. Starting with the mid 1920’s farmers had been making way more food than the people were eating therefore putting farmers into debt for their expense.
