The study will examine what caused the great depression, when it was experienced, and the regions affected by the depression. In addition, the study will explore the consequences and implications of the affected nations. …
The great depression was an economic disaster that affected Europe, North America and other industrialized nations for a period of one decade; from 1929-1939. The depression was the worst depression the Western industrialized world has ever experienced in the modern times (McElvaine 46). America started feeling the depression earlier than other countries due to the collapse of the prices of stock market of the New York Stock Exchange in the year 1929. Within the next few years, the stock price continued falling; they lost their value with a decrease of 20%. This decrease in assets’ value ruined countless numbers of investors, and the performance of banks started declining.
Many financial institutions could not withstand the strain from the ensuing depression. People lost trust in the economy and minimized their levels of demand and spending (Burgan 117). Consequently, production declined with a big margin; the overall consequences of these situations escalated the advancement of the great depression. Sudden fall in output led to a deadly situation of unemployment in America because more than fifteen million Americans lost their jobs. Although the utter depression began in the US, it swiftly became an international economic crisis because of the close relationships, which developed between the European economies and US after the First World War (Burgan 117). The US was the chief creditors of Europe during and after the war since the European economies were destabilized by the war debts and the war itself. Other nations like Germany had suffered heavy economic strains due to defeat in the battle because they were required to reimburse war damages. This connection was extremely tight and close. When the American economy crushed down, the Europeans countries were also affected since the flow of traders and investors to Europe ceased. Unemployment in Germany skyrocketed within a short period claiming the jobs of more than six million people (McElvaine 46). The great depression was a bit soft on Britain because the unemployment levels were not as high as in America and Germany. However, Britain’s export and industrial sectors were depressed for a longer period that other countries, and they only recovered in the mid 1940s. All countries came up with strategies that would guard the domestic industries and boost their production. Nations imposed tariffs and increased the existing tariffs to discourage international trade (Downing 94). Imports were crowded with quotas; this resulted to a decline in international trade with more than half. When the world trade collapsed, the international economy was disintegrated into trading blocs, which were influenced by currency of trade and political allegiance. This trade between blocs was open to many countries. Political implications of the great depression The political implications of the great depression were profound. Countries such as Japan and Germany reacted to the depression by forming militarist governments who came up with regressive foreign policies, which resulted to the Second World War. In Britain and the US, the government intervened in the issues that affected people by forming welfare system for the citizens (McElvaine 47). The government managed all the economies with little intervention from individuals. President Roosevelt came up with employment schemes, which aimed at reducing unemployment. People were given street cleaning jobs and painting the public buildings. Further, Roosevelt came up with policies that supported the industrial and agricultural sectors. Although these measures did not yield to rapid economic recovery, they enhanced the overall ...
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(The Great Depression Essay Example | Topics and Well Written Essays - 1250 Words)
“The Great Depression Essay Example | Topics and Well Written Essays - 1250 Words”, n.d. https://studentshare.net/other/7547-the-great-depression.
It all started in 1929 and the world trade shrank by more than 50 percent. The great depression is known as the worst economic decline in modern economics history. Employment decreased greatly all over the world and poverty reached new levels.
It is a time in history when the world`s economy depreciated to the lowest grid ever in the late 1920s (Burg, 2005:15). During this phase it recorded the highest unemployment levels, the production process in the world almost came to a halt, and a sharp decrease in the stock market prices.
The Great Depression
The Great Depression was a severe depression of the economy on a global scale that occurred in the 1930s decade and preceded the Second World War. The Great Depression served as the longest and broadest depression of the economy with the most significant effect in the 20th century.
Stock prices fell at great paces and people could not sell stocks because there was no buyer. Similarly, banks had huge deposits in stock exchange (Watkins 42). Crises forced banks to close their business. Fewer banks initially took step of closing their business, which
After World War 1, America became a wealthy nation, people moved from rural areas to the cities in search of a successful life. America’s industrial sector was growing rapidly and there was plenty of employment. People speculatively invested in the stock market without regards to future occurrence they believed that it would continue to rise in the years to come.
The lingering ravages of Great Depression are still visible in terms of the economic crises it created to successive generation of families. According to economists, this damaging phenomenon was directly
Women became full of life and started drinking, wearing short skirts and worse of all, smoking same to men (Freedman 61). Many average American bought automobiles accosted by household appliances on credit. In as much as many businesses grew by 65% from
Although some countries like Germany were experiencing the economic depression by 1928, the economic slump that hit U.S economy in October 1929 marked the beginning of the great depression (Smiley 1). The
According to the report during the 1920's, America was going through a period of economic success that saw the emergence of new technologies such as home appliances, machinery used in agriculture, and growth of the credit industries. Due to this boom, farmers and companies increased their production to a point where they lacked a market for their produce.
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