The Great Depression 1930

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Introduction: The Great Depression was a severe worldwide

economic depression in the decade preceding WorldWar II. It was the longest, most widespread, anddeepest depression of the 20th century, and is used inthe 21st century as an example of how far the world'seconomy can decline.

The 'Great Depression' was a period in History whenbusiness was weak and many people were out of work.

The depression originated in the United States,starting with the stock market crash of October 29,

1929 (known as Black Tuesday), but quickly spread toalmost every country in the world.

In fact, the boom in the stock market and in realestate, along with the expansion in credit and highprofits for a few industries, concealed basic problems.
http://en.wikipedia.org/wiki/Depression_(economics)http://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929http://en.wikipedia.org/wiki/Black_Tuesdayhttp://en.wikipedia.org/wiki/Black_Tuesdayhttp://en.wikipedia.org/wiki/Wall_Street_Crash_of_1929http://en.wikipedia.org/wiki/Depression_(economics)


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Causes: 1. Stock Market Crash of 1929:

Two months after the original crash in October, stockholders hadlost more than $40 billion dollars. Even though the stock marketbegan to regain some of its losses, by the end of 1930, it just was

not enough and America truly entered what is called the GreatDepression.

2. Bank Failures :Throughout the 1930s over 9,000 banks failed. Bank deposits

were uninsured and thus as banks failed people simply lost theirsavings.

3. Reduction in Purchasing Across the Board


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Contd.As people lost their jobs, they were unable to keep up withpaying for items they had bought through installment plansand their items were repossessed. More and more inventorybegan to accumulate.

4. American Economic Policy with Europe:

As businesses began failing, the government created theSmoot-Hawley Tariff. This charged a high tax for importsthereby leading to less trade between America and foreign

countries

5. Drought Conditions:

Drought that occurred in the Mississippi Valley in 1930.
http://americanhistory.about.com/od/greatdepression/f/smoot_hawley.htmhttp://americanhistory.about.com/od/greatdepression/f/smoot_hawley.htmhttp://americanhistory.about.com/od/greatdepression/f/smoot_hawley.htmhttp://americanhistory.about.com/od/greatdepression/f/smoot_hawley.htm


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Effects: The Depression became a worldwide business

downturn of the 1930's that affected almost allcountries.

International commerce declined

Sharp reduction in tax revenues, profits and personalincomes

Sharp decrease in world trade

Decreased consumer demand Unemployment in the United States rose to 25%

Construction was virtually halted


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Contd. Farming and rural areas suffered as crop prices fell by

approximately 60 percent

Banks, stores, and factories were closed and leftmillions of people jobless and homeless.
http://en.wikipedia.org/wiki/Farminghttp://en.wikipedia.org/wiki/Farming


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Recovery:Various countries around the world started to recover

from the Great Depression at different times

In most countries of the world recovery from the GreatDepression began in 1933

The President of US tried to stimulate the economythrough the NATIONAL RECOVERYADMINISTRATION, charged with establishingminimum wages and codes of fair competition in every

industry. It was based on the idea of spreading workand reducing unfair competitive practices by means ofcooperation in industry.


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Contd. second administration gave more emphasis to public works

and other government expenditures as a means ofstimulating the economy

The government refinanced about one-fifth of farmmortgages through the FARM CREDIT ADMINISTRATIONand about one-sixth of home mortgages through the HomeOwners Loan Corporation.

The WORKS PROGRESS ADMINISTRATION employed anaverage of over 2 million people in occupations ranging

from laborers to musicians and writers. The PUBLIC WORKS ADMINISTRATION spent about $4

billion on the construction of highways and publicbuildings in the years 1933-39.

Documents

The Great Depression 1930