The stock market crashed on 29th October Black Tuesday and investors including banks lost billions of dollars. The effects of the Great Depression were more severe in America but were felt across all world economies. Investors in the stock market could not pay their loans. These included real estate companies.
People demanded their deposits from banks in panic and as a result, there was less money in circulation. Companies closed down because of deflation and low demand while some laid down thousands of their workers.
Consequently, unemployment levels increased. Real estate properties that were once priced possessions lost value.
Investors in real estate could not pay their mortgages. Banks repossessed their properties, which were worthless because no one could afford to buy them. This lack in money caused a dramatic decrease in production quality and quantity. This drop in production led to a drop in employment. Foreign trade also took a violent blow. Many tariffs were placed on imports and exports.
Most significant was the Smoot-Hawley Tariff Act of which increased the number of tariffs greatly. Thinking the law would reduce the price on goods, President Hoover signed it. In reality the act made tariffs rise so high, foreign countries raised tariffs on U. During this time prices of agricultural goods fell by one half.
This was caused by the high tariffs making the export of goods very unprofitable. The farmers in effect produced a surplus of crops. This surplus made the price of crops drop and many farmers had too much food than they knew what to do with. But getting away from the industrial failures of the U. Millions of Americans suffered as a result of the happenings. Many people died simply from malnutrition and disease. Thousands of homes were lost due to the lacking ability to make mortgage payments.
Nearly 25, families and , people were left to wander around the country in a search for survival. Welfare agencies opened up and religious missions tried to offer as much support as possible to the homeless masses. Once successful people were lowered to stealing food or eating scrapes out of the garbage cans. Another problem arose when farmers decided to not ship their goods to markets in hopes of a rise in prices.
This backfired and put the country into more trouble because now food was even harder to obtain. These elements of nature wiped out thousands of farming families. The sad reality was that the plantations became crowded quickly and work was no longer needed.
Many families spent months traveling from the mid-West to arrive in California to find no work. Back in Washington, Hoover had ideas of his own. He believed that if business was left alone then it would work itself out if not interfered with. Different bodies to carry out this function were established. These included the Securities and Exchange Commission which was established in The main role of these institutions was to control and regulate stock issues in the stock market, especially with regard to the new products.
The Banking Act went ahead to come up with deposit insurance, whose role was to work with the banks by prohibiting them from underwriting. Deposit insurance was not so popular in the world up to the Second World War.
This time it was able to work effectively, hence achieving its mission and objectives. Growth of macroeconomic strategies. The aim of the latter was to fight the economic upturns and downturns.
As a matter of fact, different strategies were established to fight the Great Depression. An increased focus on how the government spend, tax cuts, and expansion of the monetary fund were some of the ways to fight the the phenomenon under consideration.
The government was also trying to work to its best so as to fight unemployment. The banks were also working against recessions. Homelessness, discrimination and racism. Many people had lost their jobs and it became even hard to get rent for their houses.
They had to move to shanty areas which also were not very affordable. Others could not afford anything to cover their heads. This led to building the Hoovervilles. Since so many people were unemployed, there was a huge competition in the job market. Very few could get jobs, and those who did were not paid according to what they delivered. Under the circumstances, discrimination grew and African Americans could rarely get a job.
Racism was an issue at that time. Americans were more aggressive as they noticed that there were shrinking opportunities to get a position.
This is because of the discrimination and racism that were going on. Again, the whites were claiming the jobs which were paying poorly, hence occupying the opportunities that these minorities had before Hoovervilles. It is evident that in any country there are different levels of people as far as their income is concerned. Where people live is different depending on what one eats. The lifestyle generally depends on what the person earns….
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The great depression is a major contributor for this. 20th century theatre is when the Great Depression plagued Europe, Because of this playwrights started to make plays on realism like John Osborn’s Look back in anger.
“The Great Depression of the ’s was a worldwide phenomenon composed an infinite number of separate but related events.” The Great Depression was a time of poverty and despair caused by many different events.
The great depression is an immense tragedy that took millions of people in the United States from work. Read full The Great Depression essay. Essay on The Causes and Consequences of the Great Depression Home \ Free Essay Sample Papers \ The Great Depression was a long-lasting economic crisis in the global economy which started in the U.S. in , and later involved other countries.
The great depression essay in front of you offers a detailed summary of what caused the Great Depression that took place between and - a period of worldwide economic crisis that began in the United States of America. The Great Depression. The Great Depression was the worst and longest economic downturn in the history of the world economy. The Depression began in and lasted until This economic meltdown affected Western industrialized economies but its effects spread across other nations.