Causes and Effects of the Great Depression
The Great Depression was the most catastrophic event in U.S. History. It not only crippled the economy, but stunted political and social aspects of American life as well. Before the Depression, the twenties roared. The previous decade flourished after the slight recession following World War I, but overall made for a hopeful future. People celebrated the end of the war by spending money and enjoying all that life had to offer. This came to a screeching halt when the Depression hit in 1929 and would change the lives of Americans forever. There were many causes of the Great Depression with just as many effects that would change the lives of millions. The crash of the economy and the people’s reaction to it caused the extreme recession, and as a result, the individual family suffered greatly as did the economy. The 1930’s and early 1940’s was a dark period for the United States and left many people suffering. There were many three major economic causes that triggered the Great Depression: the stock market crash of 1929, the nationwide bank failures and a strangled European foreign policy. The biggest cause was the Stock Market Crash of 1929. October 29th, 1929, also known as Black Tuesday, has been known as the worst day in the history of the New York Stock Exchange. On Black Tuesday, 16.4 million shares worth nearly $14 billion, worth roughly $185 billion today, were lost. The stock market dropped 25% and lost another $30 billion, worth roughly $1.3 trillion today, over the next four days. The stock market reached its lowest point on November 13th, 1929. In addition to the Wall Street Crash, banks all over the country began to fail. Deposits were uninsured, so that once the bank failed, all the money in it would be lost. Families who lost everything were faced with problems that included homelessness and poverty. Surviving banks became extremely cautious and were unwilling to hand out new loans due to the uncertainty...
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