The Great Depression: The Main Causes Of The Stock Market Crash

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The Great Depression - Stock Market Crash In the beginning of the 1920s, after World War I victory over Germany and Japan, the United States were going through one of the best economical periods in their history. The U.S. economy increased rapidly, there was peace, wages increased, and prices fell. However, during the 1930s, the United States faced a time of great suffering, as the Great Depression took place. The Great Depression was a period of economic crisis that led to dejection and poverty, lasting from 1929 to 1941, when the United States joined World War II. Nowadays, historians discuss about all the possible causes that led to such a gloomy period as the Great Depression, which is considered the most critical event of the 20th century.…show more content…
During the 1920s, before the Great Depression, the United States were living an age of intense social and political change, known as The Roaring Twenties, where the nation’s wealth massively expanded. However, as the Great Depression took place, the American economy incredibly was vastly reduced. Due to this event, the whole society was affected, especially the workers. As the economy slowed down, the workers’ wages were decreased at a point in which they were even struggling to find enough food. Leo Wolman, an important economist during the 1920s and 1930s wrote in one of his articles that, “The wage history of the current depression is of exceptional interest because of the severity of the decline in wages since 1929” (Wolman). This quote was made in 1933, thinking that the wages were at their lowest point, but each year their percentage diminished. However, if the workers had not lost their job yet, they could have considered themselves…show more content…
As the workers during the 1920s were all employed and had a decent salary, the stock market crash negatively contributed in their lives. According to an American writer and historian, “The unemployment rose to 25% at its highest level” (Barile). This tremendous fact is very significant as it shows how the destiny of the entire country drastically changed after the stock market crash. The unemployment, which resulted 15 million Americans to be without job, it had some side effects and impact on society. It created fear in workers. Even tough workers were already struggling with their low wages, the rise of unemployment made them afraid of losing their job and end up jobless. Unemployment also did not provide insurance for the citizens without job, leaving them with miserable chances of living. There are many causes that separately contributed to the beginning of the Great Depression. However, the stock market crash created several reasons that can refer to it as the main cause of the Great Depression. As the stock market crashed, immediately many banks went bankrupt, workers’ wages were lowed due to the economic issues, and unemployment raised, still being the highest percentage ever recorded in the United
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