The Great Depression

Topics: Great Depression, Unemployment, Poverty Pages: 2 (681 words) Published: April 29, 2013
I could not agree anymore with Albert Einstein’s quote which was, “What goes up, must come down,” it is true. He was extremely accurate with this saying. I am, of course, referring to the Great Depression. From 1929 to 1940, the United States suffered from the greatest economic depression in history. An economic depression is a downturn in the country's economic flow.The unemployment rate in 1932 was 12,060,000 people. The suicide rate from 1930-1940 was at 154,000 people. The Great Depression lasted ten years; a full decade. So, what exactly caused the Great Depression? Well, there were many causes resulting in the Great Depression, but three significant and predominant causes such as, speculation/installment buying, uneven distribution of wealth, and overproduction. I believe that speculation and installment buying is truly what caused the Great Depression. People were ignorant and did not think about the future. This all set up a constant cycle of failure up for the economy. Speculation is when the stock brokers predicted that the stocks prices in future. If the speculation is positive, it is bought. If the speculation is negative, it is not bought or sold. Investors put their own money into stock securities, money they lost when the market crashed. (Doc 5) Installment buying was when people made large purchases they could not afford and were credited money to pay back over a period of time. The period of time before the Depression the stock market was very impressive. People were spending so much money not realizing it was not going to be paid back. (Doc 6)

There was a huge uneven distribution of wealth in the country as well. Families were split in half. There were both poor people and rich people. The rich people were very rich and the poor people were very poor; there was no in between. The economy was not circulating that way. Some families were living on incomes as low as forty-six cents a day. (Doc 7) Major companies were affected because they could...
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