The Great Depression

The greatest and the longest economic

recession in modern world history. 
 What is The Great Depression?
 The Great Depression was the greatest and longest economic recession in modern world
history.
 The American public began a frenzy of investing in the speculative market in the 1920s.

 The1929 market crash wiped out a great deal of nominal wealth for individuals and
businesses alike.
 Other factors including inactivity followed by the excessive action by the Fed also
contributed to the Great Depression.
 BothPresidents Hoover and Roosevelt tried to mitigate the impact of the depression
through government policies.
 Neither the government policies or the beginning of WWII can be single-handedly
credited with ending the depression.
 Trade routes created during WWII remained open and helped the market recover.
 Causes of The Great Depression
Lasting almost 10 years (from late 1929 until Cause 1
about 1939) and affecting nearly every • The stock market crash of 1929.
country in the world, the great depression
was marked by steep declines in industrial Cause 2
production and in prices (deflation),
mass unemployment, banking panics, and • Banking panics and monetary
sharp increases in rates of poverty and contraction.
homelessness.
Cause 3
There is no consensus among economists
and historians regarding the exact causes of • The gold standard.
the Great Depression. However, many
scholars agree that at least the following four Cause 4
factors played a role. • Decreasing international lending and
tariffs.
 Effects of The Great Depression
For many years, as one economic
malady after another befell the country,
American citizens were left in awful Unemployment
conditions, with poor jobs and wages. Skyrockets
Many no longer had savings. A severe
drought struck the Southern Plains,
causing the infamous Dust Bowl. This Banks Closed
meant many U.S. farmers, in addition to
being hurt by the tariffs and trade
decline, no longer even had usable land
for farming.
FDR Elected
The Depression in International Perspective
 Change in Economic Indicators 1929-32.
• The following table United United France Germany
States Kingdom
indicates the
changes in the
Industrial -46% -23% -24% -41%
economic indicators Production
in countries that
were affected the Wholesale -32% -33% -34% -29%
most. Prices

Foreign Trade -70% -60% -54% -61%

Unemployment +607% +129% +214% +232%

 What Ended The Great Depression?

The New Deal

• When Roosevelt entered office, he immediately began implementing policies that were
part of what would be known as the "New Deal.” It focused on economy, the banks and
farmers in an attempt to strengthen them at their weakest. The Acts enlisted in the deal
attempted to stabilize the banking system after thousands of failures and save farmers,
their farms and their crops. 42 agencies were designed to create jobs, allow
unionization, and provide unemployment insurance. Many of these programs still exist.
They help safeguard the economy and prevent another depression.
World War II
• On the surface, World War II seems to mark the end of the Great Depression. During the
war, more than 12 million Americans were sent into the military, and a similar number
toiled in defense-related jobs. Those war jobs seemingly took care of the 17 million
unemployed in 1939. Most historians have therefore cited the massive spending during
wartime as the event that ended the Great Depression.
 Timeline of The Great
Depression
The following picture shows the
timeline of The Great Depression
indicating its causes and effects.
The years of the Great Depression
presented great turmoil for the
country and the world. After that
struggle, lessons had to be learned by
the government and the Federal
Reserve on how to avoid letting a
recession turning into a depression of
that magnitude ever again.
Thank You!