From what I have researched there are various reasons that led up to the Great Depression. It all began on October 29th 1929, better known as Black Tuesday when the stock market crashed. The stock market crash was one thing that led to the Great Depression. Stock holders lost more than 40 billion dollars from October through December 1929.Bank failures are another main reason for the Great Depression. People began to lose savings. The banks that were not failing were not trustworthy of the economic situation and started producing fewer loans.
Business failures and job losses had a big impact on the Great Depression as well. People stopped buying goods and as people stopped buying a reduction in the number of goods took place. This led to problems in the workforce. People were now losing jobs as and they could no longer afford what they had purchased using installment plans. As you can probably imagine the unemployment rate began to rise.
Trade with foreign countries was affected greatly and played a part in the Great Depression. The congress passed the Hawley-Smoot Tariff Act to protect farmers and manufacturers from foreign competition. This created a high tax for imports, and led to less trade in the Americas. Not only did the American economy collapse, Europe’s economy suffered as well.Although the drought that was in the Mississippi Valley was not a direct impact on the great depression it did affect it. Many farmers could not pay their taxes or loans and had to sell their farms for a lower value.I think that the Great Depression must have been a really hard time. I feel for the people who lived during this time and I’m glad I didn’t have to experience something like this. Within the past year with these economic conditions and people losing their jobs it started to appear that we may be going into another depression.Sources:http://www.english.illinois.edu/MAPS/depression/photoessay.htmhttp://americanhistory.about.com/od/greatdepression/tp/greatdepression.htm
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