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The Great Depression - "From Boom To Bust" - How America went from massive growth to crippling depression

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Introduction

UNITED STATES 1919 - 1941 HISTORY COURSEWORK ASSIGNMENT 2. THE GREAT DEPRESSION. The 1920's were the boom years for the American economy. America experienced prosperity in all parts of it's economy, industry and entertainment were all doing well and people had more money to spend. America was portrayed as a country which was doing well and had recovered from the war well. People were doing well. As the Republican Presidential candidate Herbert Hoover said : " We are nearer today to the ideal of ending poverty and fear then ever before in any land " But this was not true. Declining industries like coal, steel and textiles did not experience the boom. These people did not have the money to buy the luxuries produced by affluent industries. 78% of the profits of the boom went to a small proportion of the population - 0.3%. This caused companies to overproduce soon they were making large numbers of goods which could not be consumed. Instead of making profits these companies started losing money. In 1927 the spending power of American people per head began to fall. In an attempt to protect it's economy America imposed tariffs on foreign goods coming into the country. ...read more.

Middle

save money. The Wall Street Crash had many long and short term effects. The crash sent many firms bankrupt because they could no longer sell products because most people who speculated on the stockmarket had invested their life savings on the stock exchange. Those who had bought shares 'on the margin' were now in debt because they could not pay back what they owned. Often they had to sell possessions to raise the cash. Companies had to lay off their workers to reduce expenditure. This led to unemployment. Unemployment rose from 1.5 million in 1929 to 3.25 million in March 1930. This again led to a vicious cycle of unemployment, less spending, cut backs in production and further unemployment. Banks also suffered intensely. People who had speculated 'on the margin' were often unable to pay back loans because the shares were now worthless due to the Crash. People also began to lose confidence in banks and more banks went bankrupt. Among 1929 and 1932 over 5000 banks went bankrupt. This also led to 'runs on banks' where people were apprehensive about leaving their money in banks so they recalled their money and this caused the Banking Collapse. ...read more.

Conclusion

President Hoover believed in ' Rugged Individualism ' and felt that it was up to the private businesses to get America out of Depression. No government unemployment benefit was provided. This left many people feeling bitter. In the 1932 elections the democratic candidate was Franklin D. Roosevelt. He promised people everything which President Hoover had failed to provide. He promised to give people a 'New Deal'. He also gave the American people hope. He was elected in 1933. The Great Depression was the worst thing to have happened in American history. From being the richest country in the world America became the poorest. Millions of people descended into remorse. It is ranked as the worst and longest period of high unemployment and low business activity in modern times. The Great Depression caused some nations to change their leader and their type of government. The Great Depression affected almost every nation. It caused a sharp decrease in the world trade because each country tried to help its own industries. The Depression had lasting effects on the United States government and on many Americans. It taught Americans not to take for granted material comforts like household appliances and cars. Anything can happen overnight, like Americans experienced the hard way. ************************************** ?? ?? ?? ?? THE GREAT DEPRESSION IN AMERICA . ...read more.

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