The Great Depression lionel martinez

During WWI America did all they could to give everything to the war effort.

Farm prices declined since they had to provide food for the troops in the war. Farmers also went into debt since they had machines to do some if their work for them.

German War Reparations

Because of the Treaty of Versailles Germany had to pay for the damages they've done to France over WWI. President Herbert Hoover also proposed in July of 1931 a "postponement during one year of all payments on intergovernmental debts, reparations, and relief debts, both principal and interest.” Stock prices leapt upward “all around the world.

Inflation and unemployment

If the prices of a certain product increases then the unemployment rate rises. Inflation and (un)employment are two of the most important economic variables that affect us in our daily lives.

Overproduction and Underconsumption

Overproduction is the accumulation of unsalable inventories in the hands of businesses. Overproduction is a relative measure, referring to the excess of production over consumption. The production line produced a lot more goods, but people could not afford to buy them. The production lines kept producing while the people were not buying. This created extra goods, which lowers the prices of the goods.

Stock Market Crash

In a single day Billions of dollars were lost, wiping out thousands of investors. In the aftermath of Black Tuesday, America and the rest of the industrialized world spiraled downward into the Great Depression

Banks Collapsed

During the 20s, there was an average of 70 banks failing each year nationally. After the crash during the first 10 months of 1930, 744 banks failed – 10 times as many as usually.

Effects in the U.S.

Over 100,000 farmers were forced to leave their farms. Imports decreased by 55% and exports by 25%. 13 million people were unemployed, desperate for work.

Effects in Germany

Unemployed men lining up to register for work, Berlin 1929. By 1932 unemployment in Germany reached more than six million. Despite the partial recovery from 1924 to 1929, the Wall Street Crash plunged Germany back into crisis.

Effects in Spain

In the decade of the 1930s the Spanish economy reported an slowdown of 20%, less severe than what occurred in the US, France and Germany, but very similar to the Italian and British experiences.

The New Deal

When President Franklin Roosevelt took office in 1933, he acted swiftly to try and stabilize the economy and provide jobs and relief to those who were suffering. Over the next eight years, the government instituted a series of experimental projects and programs, known collectively as the New Deal, that aimed to restore some measure of dignity and prosperity to many Americans.

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Lionel Martinez

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