#17 Great Depression (Causes of Great Depression)
WW1
After WW1 Germany was in so much dept to France, England and the US due to the Treaty of Versailles. When Germany was trying to pack everyone back they borrowed money fro the US and that made the already weakling banks crash. So they US didn't allow them to borrow money anymore.
1929 Crash
Also known as the Black Tuesday. Began in October 1929. This crash was the most devastating in US history.
Weak Banking
Banks go under because people were taking all their money out So he banks become weak. This also caused panic.
Easy Credit
Buying on credit is when one gives a down payment on a product to receive it then pays, small amounts over a long period of time- instead of paying it all up front.
Deflation
Deflation happens because of overproduction. So when people couldn't buy goods deflation happened. Then that caused unemployment because not enough money was being made.
Dust Bowl
For years farmers over planted and poorly managed crops between 1930 and 1936. Soil trued into dust and large dark clouds could be seen across many states.
Under consumption
Happened when people didn't have enough money to go and buy products.
Fisscal Policy
Lasie Fair- Letting the economy take its own coarse Gold Standard- US didn't want to change the price of gold to help the economy which would create more money. When Britain did this they where the first ones to start and get out of this economic depression. Reconstruction Finance Corporation- A government founded program. Which supported supported banks and gave loans out to states to rebuild.
Overproduction
Overproduction happened during the great depression because people couldn't buy products. This led to deflation witch led to unemployment because business couldn't sell product. Then all the banks went bankrupt due to people wanting to take out all their money. That then went to loss of home and the mass margin. Then went back to over production and back around.
Bankruptcies
This happened when overproduction happened and then deflation witch led to unemployment which led to people scared and taking all their money out of banks which led banks to
Unemployment
Unemployment happened because of overproduction and deflation because not enough money was being made so the boss had to start laying people off so his company might survive.