It both harmed and helped society when president Franklin Delano Roosevelt came into presidency. The 1930’s were very important due to in that decade lots of things happened to negatively impact the country but we came out of the dust. Imagine this, living in a world with no money or food. A world where over 30,000,000 americans are left jobless because your country’s currency lost its value to basically nothing. Unfortunately, that was life in the year 1932 this was one of the hardest times for
Many Americans found themselves lacking money during the 1930s as the supply of money became unable to keep up with the demand people had for it (Wicker 994). The banks closing and people losing money or property due to loans, left people in a state of poverty as they lacked the money to do anything about it. Alongside the Great Depression, the Dust Bowl occurred as well. Many American farmers faced large dust storms during the 1930s, causing changes to their livelihood and state of being (Lookingbill 1). These dust storms made changes to the Great Plains, forcing away a large number of farm families.
Great economic growth through thriving businesses and investments in stocks made with trust in the 1920’s was familiarized as the “Roaring Twenties”. The economy went on a spiralling downfall in 1929 when the stock market crashed which triggered the Great Depression. With the economy at an all time low, the employment rate dropped immensely as well as the wages. As a result, people lost their homes which forced them to live on the streets. The demand for the government to take action and provide relief was high.
Firstly, the main catalyst of the disaster is the predatory lending of subprime loans at a time when interest rates where impeccably low. Banking institutions provided subprime loans to many Americans in order to purchase homes, vehicles and other commodities without the means to repay them with interest in the future. As a result, banking corporations made huge losses and defaulted, costing millions of people their jobs. Moreover, the inability of banks and corporations from repaying international institutions spread the financial burden on other countries. Emerging economies such as China foreseen slow projections of growth while European countries such as Ireland defaulted into bankruptcy entirely.
The economic depression not only affects the interior of the country, but also affects the relations between countries. High unemployment, low production and deflation had brought the world further into chaos, and international relations have deteriorated. “By its height in 1933, unemployment had risen from 3 percent to 25 percent of the nation’s workforce. Wages for those who still had jobs fell 42 percent.” In order to protect the domestic industries and employment, the government may raise tariffs to stable social order. In the early time of the great depression, the government leader passed the Smoot-Hawley tariff in US.
In what ways did the Great Depression affect the American people? After a decade of economic prosperity, what seemed like an era that defined the concept of the American dream, quickly came to an end when the stock market on Wall Street collapsed in 1929. The aftermath of the events that occurred on Wall Street would put its heavy mark on the years to follow among the citizens of the United States. Banks closed down, unemployment rose and homelessness increased. It was a widespread national catastrophe that had its impacts on both poor and rich.
This increased accordingly to the increase of US demands to Germany to repay such debts. Consequently, it created an economic stagnation in the country as the economy stopped growing after the incapability of European banks to finish reparations. In addition, the accumulation of these damaged the economy of the country by discouraging market loans. As a result, the Weimar government made a decision towards the benefit of its citizens and itself, financing its deficit by printing more currency (Kindleberger, 1986). He further notes that the economy of the country experienced a hyperinflation when the prices of its capital began to rise very quickly, putting the government under nationalist pressure to cut all the taxes and balance its economy (Kindleberger,
The price dropped to less than one-fifth of the value in the year 1923. As a result, farmers were affected because over half of them were relying on the production of silk as source of income. The Global Depression affected production, so the unemployment rate rose to 3 million. During the Global Depression, prices kept decreasing, which led to deflation. Manufacturers had to keep up with production as well as keep factories running, in attempt to save their business.
Economic imbalances resulting from World War I was the main cause for the Great Depression. Consumers were unable to buy all the goods produced causing manufacturers to close businesses. Closing businesses resulted in a rise of unemployment, however, President Franklin D. Roosevelt created the New Deal as an effort to alleviate poverty and unemployment. President Roosevelt believed that it was essential for the government to protect the less fortunate and improve society [1]. One of Roosevelt 's New Deal program, the Works Progress Administration (WPA), employed masses of people, saving them for poverty and despair.
b) Slow Industrial Growth Due to use of backward techniques of production our industrial sector is not at developing form. Its fewer production also creates shortage in market and caused of inflation. c) Increase in Wages & Salaries Present era labours are demanding high wages and salaries. Increment in wages and salaries it might be leads to increase in cost that increases the prices. On the other way due to high wages and salaries there is an increment in income and it reason in inflation.