Causes of the Great Depression:
-5 Major Causes:
--The Stock Market Crash of 1929- It is probably the most obvious and well known reasons as to why the Great Depression Started. It started October 29, 1929 (Black Tuesday), it actually started to get extremely bad 2 months AFTER the original crash when stockholders lost more than 40 billion dollars (holy crap). By the end of 1930 the stockholders had started gaining back some of the money but it was not enough to keep society afloat and the US entered the Great Depression.
--Bank Failure- Another quite well known cause, perhaps not as well known as the Stock Market Crash but still very advertised amongst history books. Basically what happened was people didn’t trust the banks with their money so they took it out, leaving banks with uninsurable deposits making them close. Many banks that did stay open were only worried about their future so they were nervous of giving out loans to others which lead to less and less expenditures causing them to close. 9,000 banks closed during 1930.
--Reduction in purchasing across the Board- This one is kind of obvious to me. Since people had no or little money they saved up what they had for needs such as food and even when they bought necessities it was very little. Since very little was being bought this reduced the amount of items being produced hence making people lose jobs hence making people unable to buy things and pay for the things they have making their things be repossessed. Really, if you think about it, it’s just a circle.
--American Economic Policy with Europe- I really haven’t heard much about this cause so this should be interesting. Mainly since American business was failing the government created the Smoot – Hawley Tariff in 1930. This tariff made it so there was a higher tax on imports which lead to less trade between other countries and economic retaliation.
--Drought Conditions- I have heard of this, not much but something. It technically isn’t a direct cause of the Great Depression although it did cause more strain on the country. The droughts occurred in Mississippi Valley in 1930. The drought caused people to be unable to pay their taxes hence making them sell their farms and their ways of life. This was a direct hit to the many farmers in Mississippi at that time.
-Other Causes:
--A fall in the level of asset prices- this means that the prices of land and buildings fell so people couldn’t sell their houses and get the money the house was worth so it was basically pointless to sell houses buildings or land during the depression
--Loss of confidence- pretty self explanatory, the nation just kind of lost faith in the government and economy so they stopped trying to make the economy better.
--Money Hoarding- people wouldn’t trust the banks with their money so they hoarded money and didn’t share it with anyone and hardly spent any money at all.
Sources:
http://americanhistory.about.com/od/greatdepression/tp/greatdepression.htm
http://en.wikipedia.org/wiki/Causes_of_the_Great_Depression#Specific_theories_of_cause
-Women's Sufferage
- During the Great Depression women learned many things and gained many rights. They learned the canning of food and how to ration out food to make it last longer. They learned to sew clothes, many clothes were sewn from old blankets. Many times they had no money to buy new clothes so they learned ways to preserve the clothes they already owned. Women had to learn to manage the budgets of the household so that no needed money was wasted. Many husbands were unemployed so women had to look for jobs outside of the home, althought they did earn less money than men, having some money was better than no money. Many times when women worked they traded money for goods. Because women had to find jobs outside of the home many men resented them and discriminated them.
-Sources
-- US History Textbook
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