Essay On What Caused The Great Depression

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Isaac Bernstein Mr. Cooper US History 12 March 2013 What Caused the Great Depression? The Great Depression, which lasted from 1929 to 1940, was caused by over-production and Americans gambling with their stocks. The environment from the twenties drastically changed from being a “roaring” time period, to the thirties, which were filled with depression. America went from spending money, going to baseball games, and buying fancy clothes, to unemployment, severe debt, and living off food stamps. What happened to America? The Great Depression was caused politically, by the American tariff policies; socially, by Americans gambling with their stocks; and economically, by Americans buying on a margin and the installment plan. The American government…show more content…
Consumers bought their goods when, in theory, they did not have the money to do so. Because they did not have enough money to pay, they would “buy now, pay later.” It is inevitable that consumers would lower their purchasing after this (Document H). Once the people do not have the money to keep their purchasing habits, they will ruin the whole economy. Another way the people ruined the economic system, was by buying on a margin. The people thought that they were living great, because their stocks were doing so well. Because of this thinking, they used their “great” stocks as collateral for the banks. The people who did this were very vulnerable. Even the smallest drop in their stocks would severely hurt them economically (Document G). When people realized this, they quickly got rid of their stocks. This caused the prices of stock to drop drastically, and continue to drop. This completely ruined the economy, and was a main cause for the stock market crashing, and the Great Depression. Through the United States’ tariff policies, the American way of spending money, and by the gambling of stocks, the Great Depression began. Each economic failure led to the next, and ended up destroying America’s economy. The Great Depression was cause by the social, economic, and political actions of the United
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