...The Great Depression was a dark time in American History and the world when many Americans lost their jobs and went into economic troubles. It all started when the stock market crashed in October 29, 1929, also known as Black Tuesday. The crash caused all the banks to fail and unemployment rates to rise. The rich were not affected as much as the poor were because the rich did not have to look for jobs to earn money since they already had enough of it. The poor had to starve because they could not afford to get food for their families. Many families struggled in the Great Depression due to money issues, Marriages were delayed, the men had abandoned their wives, and there were high divorce rates (By the time of Franklin Roosevelt's inauguration)....
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... | History Research Paper | The effects of the Great Depression were huge across the world. Not only did it lead to the New Deal in America but more significantly, it was a direct cause of the rise of extremism in Germany leading to World War II. | Charles Sodman1/30/2014 | Introduction According to Christine Romer the Great Depression commenced in the year 1929 till the year 1939, the longest in the history of the world. The origin of the Great Depression from the year 1929 to the year 1939 has been the worry of many researchers. However, the root cause of this unfortunate happening was hard to crack. Therefore, the search was abandoned and many speculations and assumptions were made as to what really caused the Depression. (Romer) Till present, the cause of this sad event has not been found. More so, the effects of the Great Depression lead to many broke and unemployed individuals who could hardly feed themselves daily. Additionally, goods and services were priced at 10 times less their original price. (Romer) As a result, there was a practice of extremities in Germany by individuals who took advantage of the situation for personal gain leading to the World War II. (de Bromhead, Eichengreen and O’Rourke) Countries were greatly affected as the Great Depression brought about alterations in macroeconomic policies, significant changes in economic institutions, and economic theories. (Romer) The effects of the Great Depression Crash in stock prices Stock prices...
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...“The Great Depression (1929-39) was the deepest and longest-lasting economic downturn in the history of the Western industrialized world” (The Great Depression-History.com 2012). The great depression is said to have begun after the First World War, It was a time of hardship and uncertainty. Although the great depression began in the United States it spread throughout the globe and affected almost every country. It brought about drastic declines in output, severe unemployment, and serious deflation. Many countries such as Britain, Germany and France came out of the war with large debts to pay, this was due to the fact that they had been borrowing from The United States of America, after its entrance into financial crisis the rest of the countries depending on its financing would inevitably enter down turn and face similar crisis. World War 1 also left many industrialized countries weak and in large debts, they needed to finance the rebuilding of their economies and industries that were damaged during the war, this made it harder for them to recover. There are a number of explanations to as what brought about the great depression in 1929. These are structural and monetary weaknesses as well as a number of specific events that enhanced the effects from one country to another and eventually to all major industrialized countries. What Caused the great depression? The depression was also said to have partially started with the crash of the stock market in...
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...Great Depression Causes and Effects Introduction: October 29th, 1929 would be a historical day for United States. It was enter in a new period, which was “The Great Depression” period. Great Depression lasted for 10 years. October 24th is known as the “Black Thursday”, because the amount of selling share stock was tripled. The share prices were lower, which caused the crash of the stock market. The collapse of the stock market was thought to be the main cause of the great depression, but many economists do not think so. Great Depression very quickly was spread all over the world. The Great Depression was a period of high rates unemployment, bankrupting banks, lowering prices, and increasing the uncertainty to American nation. Moreover, it brought big changes in U.S politic, society and culture. In the beginning of the Great Depression Hoover was president of U.S. He made a lot of new reforms in order to face the Great Depression, but they were not successful. People were tired with Robert Hoover’s fail. All they needed was a new leader to get them out of that bed situation. Because of these, in the elections of 1929, most of American citizens voted for the Democrat Franklin D. Roosevelt. Roosevelt brought in a lot of changes in economy, politic, social and cultural life of Americans. His major programs were the New Deal (First Hundred Days) and the Second New Deal. These programs were very effective. The number of unemployment rate was lower comparing with...
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...Great Depression Causes and Effects Introduction: October 29th, 1929 would be a historical day for United States. It was enter in a new period, which was “The Great Depression” period. Great Depression lasted for 10 years. October 24th is known as the “Black Thursday”, because the amount of selling share stock was tripled. The share prices were lower, which caused the crash of the stock market. The collapse of the stock market was thought to be the main cause of the great depression, but many economists do not think so. Great Depression very quickly was spread all over the world. The Great Depression was a period of high rates unemployment, bankrupting banks, lowering prices, and increasing the uncertainty to American nation. Moreover, it brought big changes in U.S politic, society and culture. In the beginning of the Great Depression Hoover was president of U.S. He made a lot of new reforms in order to face the Great Depression, but they were not successful. People were tired with Robert Hoover’s fail. All they needed was a new leader to get them out of that bed situation. Because of these, in the elections of 1929, most of American citizens voted for the Democrat Franklin D. Roosevelt. Roosevelt brought in a lot of changes in economy, politic, social and cultural life of Americans. His major programs were the New Deal (First Hundred Days) and the Second New Deal. These programs were very effective. The number of unemployment rate was lower comparing with...
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...CAUSES OF THE GREAT DEPRESSION October 29, 1929 was one of the most historic days in U.S. history. It was the largest crash in stock market history, and signifies the beginning of the Great Depression that lasted nearly a decade. It was the most devastating economic struggle that the United States has suffered. Although the stock market crash was the turning point in causing the Great Depression, it wasn’t its only cause. There were many different factors, beginning with the end of the World War I in 1919, that that led up the Great Depression. During World War I, the United States made a lot of money by making and supplying other countries with weapons, food, supplies and other necessities. Farmers, coal miners, textile workers, and businesses were all thriving and doing very well from the war. When World War I came to an end, the farmers, coal miners, and textile workers were the first to feel the effects of the war ending. Their goods were no longer needed for the war, and they immediately found that they had an abundance of goods that they couldn’t sell. They had to cut back on production, and employees, and wages. Once World War I ended, a peace treaty, known as the Versailles Treaty, was signed and it unknowingly became a major cause of the Great Depression. The treaty blamed Germany for the cause of World War I and demanded that Germany pay war reparation to Great Britain and France. Germany was in no position to pay the war reparations; the war cause great...
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...THE CAUSES AND EFFECTS OF THE WALL STREET CRASH AND THE GREAT DEPRESSION The economic boom of the 1920’s came to a sudden end in October 29, 1929. In June 1929 prices of stocks and shares had reached new highs. The Stock Market seemed to be a quick and easy way to get rich. The Stock Market is the place where stocks are traded. More and more people wanted to ‘play the market’ (Buy and sell stocks). [pic] The Wall Street stock market (located in New York City) was not regulated .Anybody could buy shares and they could be bought ‘on the margin’-This is when the stock broker and the stock holder merge their money to buy stocks, for example, people could buy $1000 worth of stocks for only $100 and borrowed the rest from stockbroker. Buying on the margin became a common practice. People waited for the share prices to go up again and then resold their shares for a profit. It was usually easy to pay back the loan and still make money. The day of the crash: By the summer of 1929 there were 20 million shareholders in America and prices continued to rise. But in October 1929, things began to change. Some people realized that share prices had risen too high and wanted to sell before they fell. THE CAUSES OF THE WALL STREET CRASH 1. OVERPRODUCUCTION- New mass-production methods and mechanization Meant that production of consumer goods had expanded enormously. In fact, there was overproduction (more being made than could be consumed).The market was becoming...
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...The Great Depression1929 Contents 1.Introduction 2.causes of great depression 3.Consequences of the depression. 4.Conclusion Introduction The Great Depression was a severe worldwide economic depression in the decade preceding World War II. The timing of the Great Depression varied across nations, but in most countries it started in about 1929 and lasted until the late 1930s or early 1940s. It was the longest, most widespread, and deepest depression of the 20th century, and is used in the 21stcentury as an example of how far the world's economy can decline. The depression originated in the United States, triggered by the stock market crash of October 29, 1929 (known as Black Tuesday), but quickly spread to almost every country in the world. The Great Depression had devastating effects in virtually every country, rich and poor. Personal income, tax revenue, profits and prices dropped, and international trade plunged by half to two-thirds. Unemployment in the United States rose to 25% , and in some countries rose as high as 33%. Cities all around the world were hit hard, especially those dependent on heavy industry. Construction was virtually halted in many countries. Farming and rural areas suffered as crop prices fell by approximately 60 percent. Facing plummeting demand with few alternate sources of jobs, areas dependent on primary sector industries such as cash cropping, mining and logging suffered the most. Countries...
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...I. United States of America economic history In order to successfully move forward, we need to look to the past. The country’s economic history is like all history, meaning that it examines and observes the past activities of mankind (Fite 4). The most significant periods in the United States economic history are actually the three centuries before England settled in America. There were four changes happening in Western Europe that have greatly influenced America. Those changes were economic, political, religious, and intellectual (Fite 15). So why were these changes so important? They were the reasons that England decided to explore and expand in the western part of the world. The decision to expand trade and commerce was the most important advancement in the history of economics (Fite 15). From the time that the Virginia colonies were settled in 1609 up until 1890, farming was the most important aspect of the United States economy (Fite 30). Although manufactured products were worth more than products produced on a farm for the first time in 1889, farming was how the majority of Americans made a living (Fite 30). Despite the fact that agriculture dominated in these early years and the industrialization of the colonies was well under developed, “there was a high degree of specialization in the colonial economy” (Fite 63). For example, there were tobacco crops in the southern colonies which were crops that produced money, and in the northern colonies there was international...
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...Abstract Economic depression is a state of the economy resulting from an extended period of negative economic activity as measured by GDP .The great economic depression of the US from 1929-1939 was one of the worst economic depressions in the world economy. The GDP per capita of the United States fell by a third (Federico 2005). A lot of economic activities went down and so many people suffered. Even though the depression affect the rest of the world, it has been called the great depression of the US because it’s believed that the US suffered more than any other nation and the causes are also attributed to have been started in America. Many things have been attributed to have caused the great depression among them are bank failure, Stock Market Crash of 1929, Reduction in Purchasing Across the Board, American Economic Policy with Europe, Drought Conditions but many people believe that it’s the American economic policies that really caused the depression and entirely blame the government for that. Some of the effects are increase in unemployment, collapse of banks and increase in the cost of living. On the other hand the economic recession of 2008 was longest recession since the world war two hence the term great recession. The recession lasted for 18 months from December 2007 to June 2009. Various things have been attributed to have cause the recession among them are irrational excitement in the housing market and low interest rates while some of the effects are increase in unemployment...
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...THE GREAT DEPRESSION AND THE STOCK MARKET CRASH An Introduction The stock market crash The stock market was created on 1792 to allow stocks and bonds to be traded “bought and sold”. A “stock market crash” is the steep fall of the prices of stocks due to widespread financial panic. America experienced an era of great peace and prosperity during the 1920s. After World War I, the so-called “Roaring Twenties” economic and cultural boom was fueled by industrialization and the popularization of new technologies such as radio and the automobile. Air flight was becoming common as well. The Dow stock average soared throughout the Roaring Twenties and many investors aggressively purchased shares, comforted by the fact that stocks were thought to be extremely safe by most economists due to the country’s powerful economic boom. Investors soon purchased stocks on margin, which is the borrowing of stock for the purpose of gaining financial leverage. For every dollar invested, a margin user would borrow nine dollars worth of stock. The use of leverage meant that if a stock went up 1%, the investor would make 10%. Unfortunately, leverage also works the other way around and amplifies even minor losses. In 1929, the Federal Reserve raised interest rates several times in an attempt to cool the overheated economy and stock market. On Thursday, October 24th 1929, a spate of panic selling occurred as investors began to realize that the stock boom was...
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...Bernanke's, and Liaquat's, and indeed all socialist monetarists', opinion is that rigid adherence to the gold standard "caused" the crash and depression of 1929-39 and beyond. But, as Bernanke and Liaquat admit, the central bankers of the post-war period in somes cases (France and the US quite openly and purposefully) "sterilized" their gold so that the money supply did not expand when needed but in fact contracted. So it was a failure to follow the gold standard rather than gold itself which was the culprit. Nor do either Bernanke nor Ahamed explain why the gold standard worked quite well for a century before WW1, although Bernanke admits that is an "unexplained" issue. While acknowledging the long history of the gold standard and its importance in the development of central banking, Ben Bernanke made crystal clear that we're never going back to the gold standard. He explained that the argument supporting the gold standard has two parts: 1) the "desire to maintain the value of the dollar"—implying a "desire to have very low price stability, and 2) an aversion to allowing "the central bank to respond with monetary policy to booms and busts," explaining that "the advocates of the gold standard don't want to give the central bank that power." But regardless of the impetus for these arguments, he explains, a return to the gold standard now "would not be practical for monetary reasons or policy reasons": Bernanke pointed out various reasons that there's simply "not enough gold" to...
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...Prompt: Causes and Effects of the Great Depression A lack of a resources provides an extra motivation to the individual, when times get harder instead of displaying sorrow one should work harder. Ones economic class can provide an image of ones ability to survive but when everyone is struggling economically it can’t be depicted. When society is having trouble to survive as a group, one develops the mentality that only the fittest can survive. Millions of people were unemployed, the unemployment line was the only hope for some families but regardless of how in need one was not everyone obtained a job. For the people that had a difficult time to make money previous to the depression were devastated afterwards, they were practically crawling to survival. Coming off one of the most joyful eras it seems if people got careless and despite people obtaining stocks and putting their money in bank, their money wasn’t safe. People would once hunt for their resources but in present day, most necessities contain a monetary value but a lot of people don’t recognize how hard it is to obtain money. When regarding the Great Depression it seems as if a timeline is proceeds it, when people find themselves in a predicament they attempt to remember the days when being fired from every job and struggling to eat wasn’t second nature. Previous to the great famine, there was a time when people were able to obtain several appliances and things that weren’t needed but several people were taking advantage...
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...RESEARCH QUESTION: How far was the Wall Street Crash the main cause for the Great Depression? A. Plan of the Investigation 1 B. Summary of Evidence 1 C. Evaluation of Sources 3 D. Analysis 5 E. Conclusion 7 F. Bibliography 8 A. Plan of the investigation The investigation considers the extent to which the Wall Street Crash was the main cause for the Great Depression that hit the Unites States throughout the 1930s, whose effects were spread worldwide. For this purpose the investigation assesses the significance of the crash in the stock market in relation to other factors that were also relevant. Through the selection and summary of relevant written sources, the investigation examines the 1920’s the domestic and international problems during the “prosperous” years that triggered the crisis. In order to reach a conclusion two of the sources: The Great Depression by Lionel Robbins and The Great Depression and The New Deal by Robert F. Himmelberg are evaluated for their origin, purpose, values and limitations. Word count: 120 B. Summary of evidence By the time the United States entered the First World War in 1917, the USA was the world’s biggest economic power[1]. Its role in providing extra equipment and a supply of fresh soldiers was instrumental in the final Allied victory[2]. The artificial prosperity of the war years was followed by an inevitable collapse[3]...
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...the consequences of the Great Depression for Canada? The Great Depression had a very negative effect on the economy of Canada. The stock market crashing at the beginning of the Depression sent many Canadians into immense debt and even those who sold their stocks out in time lost money. The crash of the stock market created a large problem for the economy; many banks had invested their client’s money in the stock market and when it crashed many of them were forced to close which has people panicking to get their money out of banks before they would close. This massive withdrawal of cash cause many more banks to close. Clients who did not get their money out before the bank closed also became bankrupt. With many people going bankrupt or losing large amount of money large luxury items were no longer being bought which cause economic problems for companies. The stock market crash was not the only problem, during the depression farming and agriculture took an economic downfall, the price of wheat went down lower than it had been for 300 years, European countries no longer were buying Canadian wheat. Plagues storms and infestations resulted in low yields of crops. While the depression did not cause the storms and plagues they did occur during that time and made the situation worse for farmers. Many farms went bankrupt and closed. The bankruptcy of citizens and closure of banks and farms had a very negative effect of Canada’s economy. The Great Depression changed the way Canadians...
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