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The Great Depression

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This is one of the most devastating moments that happened in American and world

history. It led to the collapse of the economy, the markets crashed, and the rate of

unemployment skyrocketed, leaving millions of people in absolute poverty and confusion.

Many people in America lost their jobs, and many companies and businesses closed. Banks and

other financial institutions were not left behind; they were closed on the basis of bankruptcy.

All this happened because the government wanted to take charge of society and fully control it.

The depression was caused when the government was empowered to involve itself in

the economy of the country. The government also wanted to control the economic activities of

society. This was a period of serious desperation and crash. This depression affected people,

making them forget about their wealth, prosperity, and growth, which they had achieved in the

past decades. The depression took place between the years 1929 and 1939, making history of

being the longest period which the western countries have had. Its beginning was marked by a

black Tuesday of October 29, 1929. This was the final and last day of the stock market crashing

and therefore kept the official beginning of the great depression period. Although it started in

the United States of America, its impact was felt by nearly all countries in the world. There was

a sharp drop in production, consumption of materials, and volumes being distributed. This

pulled down economic growth, and all other economic sectors were affected. The rate of

unemployment also raised the alarm.

The great depression was not selective but cut across all sectors of the economy around the

world. The following is a simplified summary of how different sectors were affected.
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Economy

The depression touched all sectors of the economy in different countries globally and at

different severity and time(Walton and Rockoff, 2005, p. 459). The most affected were the

American and European economies. Countries such as Japan and Latin America were not

seriously affected. All businesses ranging from small enterprises to big ones' farmers and

families worldwide suffered from this crisis. The banks panicked, consumer demand came

down, poor government policies contributed to the fall of output in the USA. During this period,

the Gold standard, which was giving fixed-rate currency exchange, decided to move from

serving the only USA and trickled down its services to other countries in the world.

Crashing down of the stock market

When the stock market crashed in 1929, it was not the only factor causing the depression. It

only increased the global crisis of the economy and accelerated the irreversible breakdown of
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all economic and agricultural sectors. 8n 1993, nearly all half of the banks in America had failed

rate of unemployment was very, very high. Over fifteen million people lost their jobs.

This failure of the stock market marked the official kick-off of the great depression. The investor's money

that was in the stock market during this period of the great depression got lost in one moment, and all

clients lost vast sums of money. Due to this crisis, banks had no option but were forced to close down

their businesses. This is because banks were relying on the stock markets, and when it collapsed, it

caused a lot of panics, and people withdrew their money from the banks due to fear of the unknown.

The market started declining in September, and on twenty-fourth October, the stock market was in

auction for the opening bell. This raised the alarm and caused great panic in people. H9wever, the first
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few days did not seem a big issue to the people, but after five days, the market collapsed utterly, losing

twelve percent of its price, and an investment worth $14 billion was also lost.

Unemployment issue

The financial crisis that erupted had a great impact on employment in the United States and other

countries in the world. Unemployment increased at a rate that was not precedented. This was

happening most in those areas with big industries with a high population of people working in a given

industry. Starting from Califonia to New york, factories, plants, and stores were closed down. Many

workers were laid off, and life became hard for families worldwide (Romer, 1991, p. 6). People started

focusing on government welfare which they had always neglected before the great depression.

Those people who were forced by circumstances to turn to government welfare were always

published in the daily newspaper. This made them ashamed because nobody could have

wanted to turn to that option. Some people took the option of selling their houses so that they

could raise money to cater to their basic needs. Divorce at this period decreased, and nobody

was ready for it due to the fear of exposing the spouse and children to hunger and suffering. All
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this time, people were blaming Herbert Hoover, the president then, and they could not,

therefore, listen to his inspirational speeches. Instead, they mocked him through jokes and

metaphors. For 8nstance, they were referring to the country as a land that suffered from

Hooverilism.
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Involvement of the government

The rate at which the government involved itself in financial markets, popular industries which

were rich made the country reach this point of the great depression. Several institutions were

started to ensure that all these economic institutions were regulated and their functions were

closely monitored(Walton and Rockoff, 2005, p. 454). This move did not fare well with the

people and the industries. Many of them felt that the government was frustrating them and

therefore decided to close down their businesses and lay off employees.
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Social issues

When the majority of the population lost their job, few companies were operating at the

minimal workforce. Therefore there was a steep competition for employment. Due to the

scarcity of employment opportunities and the scramble for the same, people started

discriminating against others based on race and gender. At this moment, the market was full of

experienced specialists who were idle due to job scarcity. Discrimination escalated, so African

Americans could not secure a job, so kong there were white Americans with similar

qualifications. This made racism become an issue that needed severe interventions. This

environment made people so aggressive in eradicating hunger, despair, and money.

Farming

The great depression was one of the mysterious things that the farmers lived to reckon. Many

farmers were located in great plains. These areas knew of droughts, dust, and storms. During

this time, they could not, therefore, get the finances to do agriculture through irrigation. The

policies that were put forth by the government to manage livestock farming led to farmers'

overgraze. Overgrazing led to drought and resulted in a lack of land for grazing. They lost a lot

of animals due to these incorrect business policies. Small-scale farmers could not manage to

lease farms due to a lack of funds. Those who had already taken loans for farming were unable

to pay because the drought scorched their crops.

Conclusion
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The great depression was a big blow to economic activities and the economy for almost all

countries in the world. Many people suffered, companies closed down, businesses suffered,

and this crisis spared no economic sector. Although the whole world experienced the weight of

economic crisis, the aftermath of the great depression was more than the immediate impact

experienced. Life after the depression changed a lot of things, including economic, social, and

human activities. Many lives were lost due to hunger and diseases. Others suffered from

psychological conditions due to stress.

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References

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