Mrs. Russell Cause and Effect Essay English 101-80 Great Depression What caused the Great Depression, the worst economic depression in US history? It was not just one factor, but instead a combination of domestic and worldwide conditions that led to the Great Depression. The causes aand effects of the Great Depression was huge across the world, here are three top causes and effects of the Great Depression.
Stock Market Crash of 1929 was one of the major causes that led to the Great Depression.
Two months after the original crash in October, stockholderzs had lost more than $40 billion dollars. By the end of 1930, the stock market tried to regain some of its losses but it was not enough and America truly entered the Great Depression. Throughout the 1930s, over 9,000 banks failed. Bank deposits were uninsured and thus as banks failed people simply lost their savings. Surviving banks was unsure of the economic situation and concerned for their own survival, stopped being as willing to create new loans.
This exacerbated the situation leadig to less and less expenditures. When the stock market crashed, and the banks failed and unemployment levels reached higher and higher pointsw people understandably stopped spending money, which also deeped the economic crisis as demand for products and services slowly stopped. First effect is Stock Market and Banking regulations, after the stock market crash of 1929 and collapse of more then 40% of American banks, strict trading and banking regulations put in place.
For financial protection newly formed Securities and Exchange Commission and the Federal Deposit Insurance Corporation for financial protection. Second effect is when Franklin D. Roosevelt’s introduced programs between 1933 and 1930, designed to help America pull out of the Great Depression by addressing high rates of unemployment and poverty. FDR and Congress introduced regulationzs and subside: the cornerstones of the New Deal wetre the Public Works Administration and the National Recovery Administration.
Third effect is when many people learned some valuable things about managing their money and doing the best they could with what they had. Children grew up to be very imaginative and inventive. They appreciated the things they had access to in their life because they never forgot just how little they once had. The Great Depression ended in the 1939 as the world increased the production of the war materials with the outbreak of WWII. War production increased jobs and hence large amounts of money were reintrodu ced to circuklate in the economy.