The people who were spending money were the poor more often than the rich; the poor were getting poorer and the rich were essentially becoming richer because even though there was no money to make, they were not spending. In the 1980s and 90s, economists argued that the Federal Reserve had caused banks to decrease their willingness to loan money, which lead to a severe decrease in consumption and in investment because no one had any money to spend. (Szostak 2003). Many people also blamed Hoover for the recession. Hoover was the president at the time.
They could also start up their industries again. This could only happen with loans from America. In October 1929, the price of shares on the ‘Wall Street Stock Exchange’ collapsed and many Americans and American businesses went bankrupt. Now at this time, America was still loaning Germany some money but as they became bankrupt, so did Germany because the USA had pulled back their loans to Germany and expected Germany to also pay interest. Germany then fell into a deep economic depression.
While some Americans were pouring their money into the economy, the government was doing very little to fix the problems of unemployment. Unemployment rates had increased by the end of 1920. The unequal distribution of wealth and income made the economy very vulnerable. High tariff barriers disabled trade between the United States and other countries. America was forced to extend credit to ever extended nations in order to keep trade alive.
Who were the winners and losers in the roaring 1920’s? Between 1922 and 1929 the annual Gross National Product of the USA increased by 40%. The average income per head increased by 27%. By the beginning of the 1920’s the United States of America was already the world’s largest industrial power. Highlights of the boom included; Consumer boom – growth of personal possessions (Woolworths, hire purchase, commercial travellers).
In the late 1920’s a change in the economy started, this change is now known as The Great Depression. The downfall of the economy started with banks and stock-market insecurity, and halted with President Franklin Delano Roosevelt’s New Deal. This revolutionary reform attempted to improve our nation by re-establishing American’s faith. Although not everybody regained the faith, the majority of people devoted to The New Deal rebuilt themselves, our economy, and the overall government. Without the help of our 32nd President, often called by his initials FDR, America could have ended in anarchy.
Describe the effects of hyperinflation on Germany in 1923. (9) The Weimar government was short of money after the First World War and so began to print more and more banknotes. The sudden flood of paper money into the economy, on top of the general strike - which meant that no goods were manufactured, so there was more money, chasing fewer goods - combined with a weak economy ruined by the war, all resulted in hyperinflation. Prices ran out of control, for example, a loaf of bread, which cost 250 marks in January 1923 had risen to 200,000 million marks in November 1923. German's currency became worthless.
The Depression started with the market crash of 1929. Unemployment was on a rise, businesses were failing. The reason of that is because the stock market was doing badly, there were overproduction and a crash which is stock prices go down. Many people lost their jobs and those that were still working had to take major pay cuts, and people who were trying to get a job couldn't because the employees couldn't pay them.
Was the great depression the main reason why the Nazi party grew between 192 and 1932? Many people believe that the Nazi party grew so rapidly because of the great depression. The great depression caused many problems to people’s lives. One group of people that were affected were the middle class. The great depression meant that many of the families had lost their savings; it was horrible to know that all the money that they had saved throughout the years has just vanished so quickly.
Iluta Urka History 220 The panic of 1873 set off a depression that lasted six years, the longest and most severe that Americans had yet suffered. Thousands of businesses went bankrupt; millions of people lost their jobs, and as usually occurs, voters blamed the party in power for their economic woes. The primary cause of the price depression in the United States was the tight monetary policy that the US followed to get back to the gold standard after the US Civil War. The US government was taking money out of circulation to achieve this goal; therefore there was less available money to facilitate trade. Because of the Panic of 1873, governments depegged their currencies, to save money.
Then on October 1929 the stock market crashed and millions of people lost money. There was also no FDIC and all of the money in banks was lost. Then in 1933 FDR proposed the “New Deal” program. This proposed different organization made just for the purpose of helping others. Close to the end of the Great Depression, Pearl Harbor was attacked by the Japanese potentially ending the Great Depression because war industry was booming because of the need for planes, tanks, bombers, bullets, and other miscellaneous supplies.