...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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...Buying on Credit in the 1920s Leads to the Great Depression in the 1930s The citizens of the United States started buying on credit in the 1920s all over the United States because there was a great economic boom. When the United States citizens started buying on credit they did not know that it was going to take a turn for the worst. In the 1920s the economy was booming with new industries and new methods of production. America was able to use a large supply of raw materials to produce chemicals, steel, glass, and machinery in which it became the structure of a massive boom in products. Stores started to sell lots of goods which made the value of stocks rise. Therefore many United States citizens started to invest in the stock market with borrowed money assuming that they would make a fast profit. Thinking they could pay the loans off when they sold the stock. There was more people invested into the stock market in the 1920s then there ever was before. They started buying cars, refrigerators, and other luxury items with money they did not have. The economy eventually quit booming and people could no longer buy things because they had spent all their money into paying off their credit. This left millions of people in debt and many people ended up losing their jobs. The stock market crashed and the economy started to collapse inflammation started and the United States entered the Great Depression. Supply and demand helped lengthen the Great Depression. American farms and factories...
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...during boston police strike of 1919 gave him reputation of a man of decisive action. Soon after elected as 29th president to succeed Harding in 1923, gained reputation as a small-government conservative, and also a man who said very little. Herbert Hoover-republican candidate who assumed the presidency in March 1929, promising Americans prosperity and attempted to deal with the Depression by trying to restore public faith in the community. “rugged individualism”-moral stance, political philosophy, ideology, or social outlook that promotes the exercise of one’s goals and desires and so independence and self-reliance. Republican Decade-The decade after WWI where there were 3 Republican presidents: Warren Harding, Calvin Coolidge, and Herbert Hoover. Laissez-faire-the type of economy where government does not interfere because the businesses are supposed to know what’s best for the economy; businesses do their own thing and government does not interfere. Great Crash-book written by John Kenneth Galbraith depicting the economic lead up to the Wall Street Crash of 1929. Argues that the market crash was able to be seen by the rampant speculation in the stock market,...
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...United States History 2 Final Review Guide Part I: Multiple Choice Chapter 20 ● Results of the Treaty of Versailles: - The Treaty of Versailles was signed after WWI in the palace of Versailles on June 28, 1919. Its goals were to "clean up the mess" after the war. The Treaty reestablished many boundaries and borders. Colonies, namely Germany's, were split among the Allied nations. Germany was disarmed since they were considered to be a threat by the rest of the world. Germany was also forced to take full responsibility for WWI, and were charged billions of dollars, which destroyed their economy. In the long run, the Treaty did more harm than good. Due to all the problems the Treaty caused for Germany, the country was left in a bad mood and was definitely looking at the rest of the world with a vengeful eye. In a way, it could be said that the Treaty of Versailles indirectly led to WWII. ● Explain the policy of Imperialism: - Simply put, imperialism is the quest for colonial empires. Countries go to other places in the world and claim them as their own. Countries imperialized for many reasons. Some countries wanted to establish military bases. An example of this is Hawaii, which the United States took over and used as a naval base. Other reasons countries imperialized were to gain global prestige, as well as to expand their territory. ● President Wilson's rules for peace after WWI: - After the war, President Woodrow Wilson sought to repair...
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...A History of the Great Depression During the 1920s, the U.S faced a time of great prosperity. Often referred to as the “Roaring Twenties”, this period brought many increasing riches and wealth. Many, lulled by the decadence of the era believed that the good times would last forever. Looking back, many would see the naivety which colored their views on what would end up being for many, artificial wealth. For, the 1930’s ushered in an era of economic collapse that would overshadow history and adequately be deemed the “Great Depression”. Ironically, the roaring twenties became a precursor to the Great Depression leading to one of the main causes, the stock market crash of 1929. The economic growth of the 1920s was unparalleled to any previous time. The United States during the 20s experienced a wave of new technology and growth. Silent Films, which could be viewed on one of the newest inventions, the television had experienced a surge of popularity as well as radios. With the increase in factories came new methods of mass production, which made the automobile affordable now to many households (Scaliger). Skyscrapers were beginning to dot landscapes in larger cities seeming to support the notions of the decade that the sky was the limit. Underneath the glitz and glamour, though a startling truth was starting to emerge. The economic growth of the past decade was partially a façade created by an abundance of newly printed money. (Scaliger). Inexperience combined with arrogance...
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...The World Wide Depression The nineteen thirties was an era of unemployment. This was a worldwide depression caused by matters such as unregulated wall street, world war one, poor sectors in the economy, and isolationism. The depression was the biggest economic fall in American’s history. This crash stretched throughout the globe and affected the rich as well as the poor. There were many causes that assisted in bringing the depression into existence. However, one of the main causes was the disproportionate riches during the nineteen-twenties. The gap between the rich and the working class people was the enlarged industrialize production during this period. In addition, this periods production cost fell quickly as wages rose slowly and prices remained steady. Following world war, one arrived what we know of today as The Jazz Age. It was movement from the 1920’s that emerged dance and Jazz music. This age glorified city life. Americans and many African American sharecroppers from the South left their farms in record numbers to live and work in places like Chicago and New York City. F. Scott Fitzgerald called it a time when "the parties were bigger, the pace was faster, the buildings were higher, the morals [reduced]". This era was also known as the "anything goes “period, which emerged in America after World War I. “The unbounded optimism of the Jazz Age and the shocking consequences when reality finally hit on October 29th, ultimately lead to the Great Depression” (PBS). Beginning...
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...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 trade with other continents (Fite 63). All of this called for a well-organized and planned distribution system (Fite 63). America had a significant increase in its economy during the beginning of the 18thcentury (Fite 102). After the Revolutionary War was over, so was the control that the British had over the colonies’ economy. When the U.S Constitution was established in 1789, it provided a...
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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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...next three years, the United States remained neutral and did not take part in the war. However, in 1917, the US Congress declared war against Germany forces due to two main reasons. First, the US government had signed an agreement with the Germany government that the Germany Submarines should not attack passenger ships in the Mediterranean Sea and North Atlantic Ocean. In February 1917, the Germany violated this agreement which annoyed the US government. Second, the Germany government had written a letter advising Mexico to attack the US. This letter was intercepted by the British, and when the United States received it, the Congress declared war against the Germany forces. The First World War was debatable war in America because there were conflicting pubic opinions. On one hand was German Americans, who were with the German government. Most of the Americans with British and France, on the other hand, origin supported the Entente forces and wanted the US to fight against the Germany. Therefore, President Wilson feared that the war would divide the country....
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...Progressive Era (Chapter 4), An Emerging World Power (Chapter 5), World War I and Beyond (Chapter 6), The Twenties (Chapter 7), The Great Depression (Chapter 8), The New Deal (Chapter 9), The Coming of War (Chapter 10) and World War II (Chapter 11). There will be 75 questions consisting of multiple choice and true/false. You may use one small 3x5 notecard for notes on the test. Do not tell others about this benefit. If you mention the notecard to anyone else or out loud, you lose this benefit for you and the person you are talking to about it. It is a reward only for those of you who read directions. Chapter 4- The Progressive Era (1890-1920) Who were the Progressives? Urban Middle Class who wanted social reforms Muckrakers Journalists who sensationalized to drive social change Define recall Power to remove public servants What did the 19th Amendment do? Gave women the right to vote What is Americanization? Teaching minorities and immigrants to follow white, middle class ways of life Who were the three Progressive Era presidents? Roosevelt, Taft, Wilson Domestic policies of Progressive Era presidents (match them) Wilson-New Freedom/ Roosevelt- Square Deal Chapter 5- An Emerging World Power (1890-1917) Social Darwinism- Survival of the fittest Alfred T. Mahan and what he argued for a stronger America Strong modern Navy Four main causes of the Spanish-American War Cuban independence movement, Yellow Press, U.S.S. Maine incident, De Lome Letter Open Door Policy (China)...
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...Analyzing the Causes and Solutions of The Great Depression The Great Depression was a disastrous time for not only Americans but for many people across the entire world. The depression was felt in a great deal of places, from both North America, South America, all the way to Europe, and even Japan. From cotton farmers, commonly known as “Okies”, to bankers in the big city, everyone felt the impact from the depression (Smiley, 2008, p.1). Although economists argue the main causes of the Great Depression, there were many different contributing factors that led to the worst financial crisis in America’s history. As the depression wore on many politicians and economists attempted to solve the problems facing Americans. It is important to remember what had caused the Great Depression as well as what brought the country back. A look into our past can possibly help to prevent future disaster facing our economy. The most commonly known factor leading to the Great Depression was the crash of the United States stock market. Although the stock market crash of 1929 is seen as the starting point of the Great depression, there were a number of causes beforehand that lead to the event that is now known as Black Thursday. The 1920’s had experienced a tremendous surge in stock prices. The Federal Reserve could not justify these prices by future earnings and in 1928 the Federal Reserve raised interest rates in order to slow rising stock prices (Pells, 2012, p.4). These higher interest...
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...Topic: The Great Depression, continued Read: In Fed we Trust, chapters 1-4 1. Define the term gold standard. Should we return to it? The gold specie standard arose from the widespread acceptance of gold as currency. No, The gold standard limited central banks from printing money when economies needed central banks to print money, and limited governments from running deficits when economies needed governments to run deficits. It was a devilish device for turning recessions into depressions. The answer is that some people aren't worried about depressions. Some people are worried about inflation. 2. Who was J. Pierpont Morgan? What was his role in stopping the Panic of 1907? John Pierpont "J. P." Morgan (April 17, 1837 – March 31, 1913) was an American financier, banker, philanthropist and art collector who dominated corporate finance and industrial consolidation during his time. In 1892 Morgan arranged the merger of Edison General Electric and Thomson-Houston Electric Company to form General Electric. After financing the creation of the Federal Steel Company, he merged in 1901 with the Carnegie Steel Company and several other steel and iron businesses, including Consolidated Steel and Wire Company owned by William Edenborn, to form the United States Steel Corporation. - The Panic of 1907 was a financial crisis that almost crippled the American economy. Major New York banks were on the verge of bankruptcy and there was no mechanism...
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...Theories post the great depression – attempts to explain the cause The causes of the Great Depression are innumerable. There is no single cause that stands out as the sole reason of this historical event that turned the world on its head. Economists have presented many views and with plenty of plausible economic theories presented, there is no clear winner. The reason for the Great Depression has been researched by economists many times in order to prevent it from happening ever again. There were many theories presented; many discarded. Now, in our present age, the list of theories that explain why the Great Depression became so popular and depressing has been narrowed now to a few main theories other than the Keynesian and Monetarist theories explained earlier. Since the start of the Great Depression the market began to plunge, economists at the time were under the impression that economies were self-correcting, and therefore, impeccable. This was their biggest mistake. They all suggested that economy had to go through a process of ‘liquidation’ before it could recover and grow again. This assumption was based on historical trends in the 19th and 20th century. These economists paid too much attention to what Ronan Keating thought about economy – as peaceful as a lake by the side of a mini golf course. Not very long before the Great Depression, economy rose, and lot of alternate peaks and valleys were created. Economists thought that deflation was the perfect infallible solution...
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...The Great Depression The Great Depression was an extremely severe worldwide economic downturn that left many homeless and even more jobless. The depression originated in the U.S., but affected many countries throughout the world. The time period of The Great Depression varied depending on the country, but first began in the late 1920’s. It ended in the late 1930’s or early 1940’s when the Second World War began. It devastated virtually everyone, rich and poor, people of all occupations. The term was first coined by British economist Lionel Robbins who wrote a book in 1934 called “The Great Depression” but popularized by President Herbert Hoover in a statement: “I need not recount to you that the world is passing through a great depression.” The cause of The Great Depression is still an open debate amongst economists and historians. Theorists can be split into two major categories: classical economists and Keynesian economists. When classical economists theorize The Great Depression, they focus on how central banking decisions lead to overinvestment and an economic bubble, or on the supply of gold which backed many currencies at that time. Keynesian economists, on the other hand, blame underconsumption and overinvestment or government and banking incompetence. Many agreed that the main event which spurred The Great Depression was the crash of the stock market in 1929. Known to most as Black Tuesday: the most famous stock market downturn in American history, October 29, 1929...
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...THE CAUSES OF AMERICAN BUSINESS CYCLES: AN ESSAY IN ECONOMIC HISTORIOGRAPHY Peter Temin* This paper surveys American business cycles over the past century. Its task is to identify the causes of these cycles; other papers in this collection address the nature of policy responses to these causes. This paper can be seen as a test to discriminate between two views of the American economy. The first is expressed in a characteristically vivid statement by Dornbusch, who proclaimed recently: “None of the U.S. expansions of the past 40 years died in bed of old age; every one was murdered by the Federal Reserve” (Dornbusch 1997). This stark view can be contrasted with its opposite in the recent literature: “[N]one of the popular candidates for observable shocks robustly accounts for the bulk of business-cycle fluctuations in output” (Cochrane 1994, p. 358). I expand the time period to consider the past century, but it is easy to distinguish the past 40 years, that is, the period since World War II. A survey of business cycle causes over an entire century runs into several problems, of which three seem noteworthy. First, it is not at all clear what “cause” means in this context. Second, the Great Depression was such a large cycle that it cannot be seen as just another data point. Third, the survey relies on the existing literature on business cycles, which is why I have entitled it an essay in economic historiography. The paper proceeds by discussing each of these problems in turn, then...
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