The Stock Market: The Causes Of The Great Depression

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The Great Depression was a disaster brought upon the U.S.A by multiple sources. There were multiple supporting causes that lead up to the crash of the stock market. The Great Depression was the largest low point that U.S economy and the worlds economy have ever seen. This time in history had the highest number of unemployed ever seen in the United States. Ben Bernanke said in 2002 that the Great Depression was the “worst economic disaster in American history”. The Depression wasn’t just cause by the stock market crash of 1929. During the 1920’s or the Roaring 20s’ loaning and borrowing money on credit was becoming popular. While more and more people were loaning out, farmers were facing an age of mechanization allowing faster and more …show more content…
So after the crash of the stock market in 1929, people rushed to the banks to withdrawal their money and most banks ended up closing up. The federal reserve should of protected the banks so people wouldn’t panic. The crash of the stock market of 1929 was a crucial point that made the snowballing depression quicken. After the market fell people began pulling money from banks. Banks started to go under. Industry started to grind to a halt without loans to make payroll. Massive amounts of people were laid off from work causing a stop of cash flow. America suddenly ground to a halt in its economy and industry. This cause our trade with the world to stop. After trade slowed down we placed tariffs to protect trade but it only back fired when tariffs were placed on our goods. The worlds economy slowed in response. The Great Depression was a time of hardship and massive unemployment. The unemployment hit a all time high at twenty five percent of America unemployed. The unemployment only snowballed on itself. After the initial wave of job loss, it only caused more and more workers to be fired. As more and more workers were laid off, cash flow only slowed down more and …show more content…
Hoover tried to stop the depression multiple ways. Hoover used the power of the Government to cushion the situation. He persuaded a large number of industrialist to maintain wage rates. Hoover got the Federal Farm Board to support agricultural production. Hoover also got congressional approval to add 140 Million dollars in new public works. However, after all this, it still wasn’t enough to stop the depression. His main problem was that he allowed private business and state and local government to stimulate the economy. Hoover believed raising taxes would help stop the depression but it only worsened it. During the presidential election of 1932, Franklin Delano Roosevelt campaigned on his idea the New Deal. The New Deal was a three stage plan to save the United States from the depression. The first stage started up the relief programs that gave help or money to poor people. The second stage was the recovery programs that fixed the economy in the short run by getting people back to work. The last stage was the reform programs that were designed to regulate the economy in the future to prevent another depression. These all tied together to slow and stop the Great

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