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Depression Essay

2505 words - 10 pages


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Great Depression The Great Depression was a disastrous business slump that affected millions of
people throughout the entire United States. It began in 1929 and continued on, to some degree, until

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Great Depression
The Great Depression was a disastrous business slump that affected millions of people throughout
the entire United States. It began in 1929 and continued on, to some degree, until 1939. People lost
their jobs, and families lost their homes. The country was in total chaos. Some believed that
America could never totally recover.

There were several factors that contributed to the start of the Great Depression. One of them was
the crash of the stock market. It was 1929, and Republican Herbert Hoover had just been recently
elected. During the previous few years, the stock market had been steadily rising, and everyone
wanted their piece of the profits. By this time, over 1.5 million people owned stock in various
companies. People in every kind of financial situation owned stocks. It seemed that it was an easy
way to make money, and most investors were getting rich. The stock market reached its all-time
high on September 3, 1929. This caused even more people to buy stock. In October of 1929,
however, the stock prices slowly began to decrease. This did not bother the stockholders that much
because they just figured that the stocks would go back up like they always did. Unfortunately,
these predictions were terribly wrong. On the 24th of October, the stock market plummeted.
Shareholders rushed to sell their stocks as quickly as possible, but they found no buyers. The 24th
came to be known as "Black Thursday." Five days later there was a "Black Tuesday." That was
when more than sixteen million stocks were sold at a great loss. One stock had dropped from one
hundred dollars to only three dollars per share. The President and the bankers tried to assure
people that there was not a crisis and that it was only a temporary situation, but they could not have
been more wrong. When the stock market crashed, it upset the whole economy. Because the stock
prices were so low, no one would invest in them. This meant that the large and small companies
who depended on the stockholder's support now had major financial problems. Thousands of
employees had to be fired because the companies could no longer afford to pay them their salaries.
Many factories, mines, and businesses were even forced to shut down due to the terrible economic
crisis. When all of these workers lost their jobs, they could hardly afford to buy food or clothing,
therefore, many of the stores were not making enough money to survive either. This caused more
people to be fired and more businesses to shut down. It was a continuous cycle that caused the
economy to get worse and worse. The unemployed people desperately needed money, so they all
rushed to the banks...

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