Great Depression And It's Effect On Britain

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To What Extent Was the Depression of the 1930s in Britain a Consequence of the Wall Street Crash? Britain after the First World War was already in an unstable condition economically, with large debts owed to America and large proportions of industry lost because of the lack of trading during the war and alternative competition. Other factors also played a part to ensure that Britain would experience a turbulent period leading up to the global depression in the 1930s. Industrial decline was increasing since the 1870s and with the help of World War One; it became a critical factor as to why some aspects of industry collapsed completely. Due to significant proportions of markets lost it was decided that the country should leave the gold standard and revalue sterling which exacerbated matters further as it was overpriced, forcing British exports to be more expensive.[1] A combination of deflationary policies mixed with a lack of decisive action also added to the existing problems that Britain was facing.[2] With all these problems already troubling the British government which changed hands various times, from a coalition to the Liberals, Labour and the Conservatives, the Wall Street Crash finally affected the whole world by the early 1930s. The Wall Street Crash occurred in October 1929 where hundreds of thousands of Americans were purchasing stocks and bonds mainly on credit and when a panic struck, prices of these ‘securities’ dropped, over 13 million shares were traded on ‘Black Thursday’ and a further 16 million on ‘Black Tuesday’.[3] All in all, over $30 billion was lost on the stock market resulting in the entire economy collapsing.[4] However, instead of an isolated large scale problem that could be solved without too much damage, it soon spiralled out of control as banks virtually became bankrupt overnight leading to an increase in tariffs
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