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The Great Depression in the U.S. believe 29 October 1929, the so-called "black Tuesday". The stock market has fallen in one day shares fell by 10 billion dollars, which meant the disappearance of lending money at a rate of $ 10 billion. Because of this falling stock market of 20-25, million people in the U.S. have suffered losses.
There is another point of view about the causes of the Great American Depression. Great Depression was preceded by a rapid growth in the U.S. economy. Therefore, from 1917 to 1927 the U.S. national income has increased almost 3 times. Mastered the conveyer production, rapidly developing stock market, increased the number of speculators who cared for the property. Growth in production of goods demanded increase in money supply, and the dollar was pegged to gold.
Before the start of the Great Depression, U.S. gold reserves are not increased as rapidly as the economy develops. This fact led to the emergence of hidden inflation as the government prints new money under the rapid growth of the economy. Thus, the dollar was undermined by the availability of gold, the budget deficit grew, and the Fed lowered the discount rate.
A situation where the growth of labor productivity in industry has declined, the number of pseudo money (bills, receipts and so on.), On the contrary increased. This imbalance in the economy and led to the "black Tuesday" of 1929.
Effects of the great depression for the U.S. and the world
The Great Depression in the United States of 1929-1933, expressed in figures, it looks depressing.
Level of industrial production in 1933 fell by 46% compared with 1929 after the Great Depression in 1929 U.S. industry has been abandoned for more than 20 years ago, to the level in 1911
U.S. GNP for the 1929-1933 year has fallen to 1.85 times from 103.9 to 56 billion dollars. The volume of unemployment rose from 3.2% to 25% in 1933, which amounted to about 12.8 million people.
According to the American Association for Research on Labor, the number of unemployed was much higher - about 17 million, about 2.5 million people were left homeless.
Ruined about 135 000 companies, corporate earnings have fallen by 60%.
The total market capitalization has fallen by 4.5 times from 87 billion to $ 19 billion Farm real estate has fallen in price by more than 10 times. Ruined about 897 thousand farms, i.e. 14.3% of the total.
Under the impact of the Great Depression hit, and other Western countries such as Germany, France, Great Britain, were also affected countries in Central and Southeastern Europe (Japan in 1927), Asia and Latin America.
The major economic event in the world history was the great depression.
What was the Great Depression? And how it affected people is a question asked by many.
It began on the 29 of October, 1929 when business was poor, and many people were out of work when the market in the United States crashed. This was the most severe depression ever experienced in the world after world war I. it ended in1939, during World War II.
Effects of the Great Depression
During this depression, mostly all countries were affected business wise. But the international commerce took a vital step of reducing tax revenues, profits and personal incomes. Countries which exported raw materials were really affected by this depression. There was a decrease in the world as countries tried to protect their industrial products by raising tariffs on import. Many nations stopped constructing, and other nations changed their leaders in government.
Adolf Hitler of German became vivid because of the poor financial situation in Germany. The Japanese on the other hand, invaded China and developed mines, and industries in Manchuria thinking it could relieve the depression. Germany and Japan reaction towards the depression brought the rise to power of militarist. The United States and the Great Britain intervened resulting to the creation of welfare systems. The great depression resulted in millions of business investors losing large sums of money and several others closing down their business completely. Closing down of these businesses from investors, millions of people were left bankrupt, jobless and others without even a shelter to lay down their heads. They ended up depending on their governments or charities from well wishers to offer them food, clothing and shelter.
A new deal was signed by Franklin D. Roosevelt after becoming president of the United States of America in 1933. His deal was to reduce unemployment by creating jobs like painting of the post office and cleaning of the streets.
Effects of the great depression ended when nations increased their production of war materials for World War II. Through this increase, of war materials, jobs became available, and money started to be in circulation. Whereas in Germany, Adolf Hitler developed a massive creation work scheme that had put many in employment. Just like practiced by many nations, the government controlled consumption by rationing also controlling trade market. Though this Germans' Gross rose to 51 per cent just by manufacturing of machinery and armaments.
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