Causes Of The Great Depression Essay

582 words - 2 pages

The Great Depression was a decade of poverty for many United States citizens. Starting in 1929, The Great Depression was a rough time not only for the U.S. but for many other countries. There are many causes for the Depression but the main cause was the combination of the greatly unequal distribution of wealth throughout the 1920's and the extensive stock market speculation(Gusmorino, 1). Other causes were the unsteadiness of the stock market, short signed economic policies, overdependence on mass production, consumer spending, advertising, welfare capitalism, and high tariff. The effect on the country of the imbalance in the economy threw the U.S. into an era of negativity.
How did the United States go from the “roaring twenties” to The Great Depression? It was all based on deflation and the crash of the economy. A good example of uneven distribution of wealth was Henry Ford’s yearly income of $14 billion the same year that the average income was $750. Another contributor to the uneven distribution was the government. Calvin Coolidge favored businesses therefore favoring the wealthy who invested in these businesses.
For an economy to function properly, total demand must equal total supply. What happened in the 1920's was an oversupply of goods. This resulted in the middle-class needing more but not being able to afford more while the upper-class didn’t want to buy more goods. Three quarters of the U.S. population spent almost all of their yearly incomes to purchase consumer goods such as food, clothes, radios, and cars. This group consisted of the poor and middle class citizens who only earned about $2,500 a year. The upper class, earning much more, were not expected to buy more food, cars, or clothing for...

Find Another Essay On causes of the great depression

Causes of the Great Depression Essay

815 words - 3 pages The Great Depression was the most catastrophic economic disaster in American history. It affected all of the US from sea to beautiful shining sea. Old and young, rich and poor, black and white, everyone suffered the consequences of the over extravagant Roaring Twenties. Businesses closed, everyone was up to their neck in debt, banks failed, and the mid-west was soon a dust bowl from over farming and reclaimed equipment. With the Smoot-Hawley

Causes of The Great Depression. Essay

3306 words - 13 pages The Great Depression was the worst economic slump ever in U.S.history, and one which spread to virtually all of the industrializedworld. The depression began in late 1929 and lasted for about adecade. Many factors played a role in bringing about the depression;however, the main cause for the Great Depression was the combinationof the greatly unequal distribution of wealth throughout the 1920's,and the extensive stock market speculation that took

Exploring Causes of The Great Depression

746 words - 3 pages Exploring Causes of The Great Depression Introduction The Wall Street crash of 29 Oct 1929 and the Great Depression that followed were such a shock to most Americans that some early attempts to explain their causes blamed sunspot activity or medieval prophecy. A few held it to be divine retribution on a people who had indulged themselves in a decade of hedonism after World War I and were due for a sobering

Causes and Effects of the Great Depression

3996 words - 16 pages C:\MSOFFICE\WINWORD\TEMPLATE\NORMAL.DOTApril 2, 1997The Causes and Effects ofThe Great Depression In AmericaFew Americans in the first months of 1929 saw any reason to question the strength and stability of the nation's economy. Most agreed with their new president that the booming prosperity of the years just past would not only continue but increase, and that dramatic social progress would follow in its wake. "We in America today," Herbert

The Causes And Solutions Of The Great Depression

2273 words - 9 pages March 4, 2000 The Causes and Solutions of the Great Depression The collapse of the stock market began on October 24, 1924. Approximately thirteen billion shares were sold. The collapse was devastating and long-term. On Tuesday, October 29th, more damage was done. It became known as Black Tuesday, and about sixteen million more shares were sold. Many businesses closed, and millions of people were left unemployed. Wages for the employed dropped

The causes and resolution of The Great Depression

642 words - 3 pages sudden economic crises that was the Great Depression. However, Franklin D. Roosevelt's plan to fix the nation that was the New Deal largely prevented the greatest problems contributing to the Depression, low money supply, unemployment and national panic regarding the banks.The New Deal included many plans of reform as well as associations to prevent and to fix the Great Depresiion. For example, one of the most direct, initial and biggest causes of the

Causes and Effects of The Great Depression in America

3738 words - 15 pages hopes of receiving plate scrapings. Nearly 2 million youngmen simply took to the roads, riding freight trains from city to city, living as nomads.The economic hardships of the Depression years placed great strains on Americanfamilies, particularly on the families of middle-class people who had become accustomedin the 1920s to a steadily rising standard of living and now found themselves plungedsuddenly into uncertainty. It was not only unemployment

This essay is about causes of the great depression.

7047 words - 28 pages Great Depression in the United States, worst and longest economic collapse in the history of the modern industrial world, lasting from the end of 1929 until the early 1940s. Beginning in the United States, the depression spread to most of the world's industrial countries, which in the 20th century had become economically dependent on one another. The Great Depression saw rapid declines in the production and sale of goods and a sudden, severe

Causes of Great Depression 1930’s

1585 words - 6 pages that they didn't have and "thoughtless cheerleading from those in authority, who fabricated reasons for the market to increase when there were none" (Termin, p 44), these are all causes of the stock market crash but not causes of the Great Depression. The stock market crash was a tremendous event, but it did not produce the Great Depression and it was not a major factor in the Depressions severity. "A sharp but not unprecedented contraction was

The Great Depression: causes and cures

648 words - 3 pages sudden economic crises that was the Great Depression. However, Franklin D. Roosevelt's plan to fix the nation that was the New Deal largely prevented the greatest problems contributing to the Depression, low money supply, unemployment and national panic regarding the banks.The New Deal included many plans of reform as well as associations to prevent and to fix the Great Depresiion. For example, one of the most direct, initial and biggest causes of

Causes of the Great Depression as Depicted in the Great Gatsby

1522 words - 6 pages where flashy cars, big houses and gigantic parties dominated the scene. Americans in this time period had no idea that the next decade would be marked with poverty and homelessness, a decade forever known in history as the Great Depression. This book contains key reasons as to why this all happened. Causes of the Great Depression as described in The Great Gatsby and through historical documentation, include the mentality of the American people

Similar Essays

Causes Of The Great Depression Essay

651 words - 3 pages economic depression started and lasted until the start of the Second World War. The three causes of the Great Depression are installment buying, uneven distribution of wealth and the irrational behavior in the stock market. Installment buying serves as the first cause of the Great Depression. In the 1920s, a large number of American families purchased automobiles, refrigerators, vacuum cleaners and similar household products on credit. Many

Causes Of The Great Depression Essay

755 words - 3 pages Causes of the Great Depression The Great Depression also called Depression of 1929, or Slump of 1929, began in 1929 and lasted until 1939. It was the longest and most severe depression ever experienced by the industrialized world. Though the United States economy had gone into depression six months earlier, the Great Depression may said to have begun with a catastrophic collapse of the stock market prices on the New York Stock Exchange

Causes Of The Great Depression Essay

3203 words - 13 pages Causes Of The Great Depression Missing Works Cited Between the late 1890’s, after the panic of 1893, and the late 1920’s, the American people led good lives in which most prospered. In the 1920’s the problems that led to the Great Depression were dispersed over a time of maldistribution of wealth, and what was called a bull market. A bull market is a stock market that is based on speculation. Speculation was a system of borrowing money to

Causes Of The Great Depression Essay

3278 words - 13 pages the real culprit. The truth behind the stock market crash is that it was the event that caused the already unstable economy to go over the limit. If the president and the stock market crash did not cause the Great Depression, then what did? According to research done on the Great Depression, the causes rest on of different factors, but can be put under two main categories. The responsibility for the Great Depression falls not only on the