What Was The Impact Of The Economic Bust In The 1920s

In the late 1920s, United States had an heavily economic bust. The bust was never happened before, and the serious impact of this crisis made all of people in the United States feel unanticipated. During this economic bust, most of American Banks were forced to fail, factories went bankrupt, and countless people were fired by their company, more and more American people become homeless. The disaster in the United States had put people in a panic. The recession also had a negative impact on America's future for a long time: such as the massive reemployment failure of residents and the United States did not use resources effectively. Because the United States had the first economic position all around the world, other countries also showed signs …show more content…
To begin with, the break down of the U.S. stock market was one of important reasons of the economic bust. At first, although people got a lot of money from stocks, they became miserable because of the later changes. When Hoover was American President, buying stocks from banks or industries became the most popular business in America. Many people got great benefit from it. The stock exchange market, which was controlled by financial giants, attracted people from all walks of life. Women, college students, or company employees all could be the major source of the stock market. People were crazy about buying stocks, and at that time every stock’s value was growing at an unimaginable rate. When people were reluctant to sell stocks that had been rising, the leaders of every industry had begun to speed up the creation of new shares. This unprecedented frenzied financial investment had laid the groundwork for the eventual collapse of the …show more content…
Although the United States’ government had enacted relevant legal policies, they had no use for the economic bust. The us government believed that factories had the capacity to regulate themselves and if government departments intervene, it could lead to inefficiency and waste of resources. This opinion accelerated develop of the economic bust. At that time, the President, including the American people, all had a wrong way to think about economic regulation. When President Hoover faced a lot of problems, such as such as bank bankruptcy, company failure and employees' unemployment, he still opposed government to organize this situation. He did not take any measures, he even ignore the poor. This traditional and stubborn economic thought undoubtedly made the American economy step by step to crisis. For this crisis, the US leader's helpless attitude made the crisis more complicated. The crisis had spread to all parts of the world. On the one hand, the US government has chosen to use policies that are inconsistent with the economic times. In 1920s, the United States vigorously developed motor vehicles and related electrical appliances, coupled with people's love for real estate, laying the foreshadowing for the outbreak of the economic crisis. These factories’ sales well at the beginning, but then their sales declined. Because the government's decision of managing the economy