The Great Depression Possible Leads to Its Cause :: essays papers

The commodious Depression Possible Leads to Its Cause The Great Depression is known as the worst economic casualty of our beat. era this fact is accepted throughout the world, a specific cause to this disaster remains a mystery. Maybe there is no one received reason. Maybe it was a result of widespread factors causing the world-wide recession. Overproduction, World fight I, and the banking remains were either origins of the Great Depression. Thanks to the roaring twenties, consumers of the late twenties were very confident. They didnt care to spend. To complement the increased spending, producers began to spend more as technology improved production speeds and costs. Author T.H. Watkins says more and better goods were produced during this time (the 1920s), than at any time in history (45). With slightly increase wages, consumers bought as much as their wallet would allow them. However, they couldnt afford to bribe all that was produced and overproduction occurred. Eve n though overproduction occurred, that still wasnt equal to cause this stagnant economic recession. World War I was partly to blame because it had made the inter bailiwick economy unstable. Though Great Britain was the national creditor before the war, devastating circumstances made G.B. needy for some pecuniary resource instead. In fact, much of the continent of europium had been destroyed. Factories, farms, and homes were all brought to the ground as the battle between nations began. By the end of the war, the United States was the least harmed of the ally nations. The United States didnt lose near the lives but it did lose a hand of money. After the war, nations still sought cash to repair their tarnished homelands. The United States and its divinatory booming economy became the lender to many countries. These loans couldnt be repaid. In fact, Europe even relied on U.S. loans to purchase U.S. goods. With the foreign trade market in a downward spiral, it was evident that ha rsh times were soon to come. As Paul Gusmorino illustrates on his web page, by 1929, ten percent of American gross national product went into exports. When the foreign nations discovered they couldnt afford to get U.S. goods, U.S. exports fell a drastic thirty percent seemingly overnight. The $1.5 jillion lost in foreign sales between 1929 to 1933 was one-eighth of all lost American sales, Gusmorino concludes. So, as the world economy became a nightmare, the banking system of the United States also became a disgust.