The Great Depression

Today I will explain to you the The Great Depression.

The Great Depression was a period that lasted from 1929 to the mid-1930s and led to worldwide economic crises. This crisis, which first started in the USA, soon affected other countries and caused a global economic collapse. Here is a detailed explanation of the Great Depression:

• Economic Situation of the 1920s: The 1920s were a period of economic recovery in many countries after World War I. However, especially in the United States, this period was marked by excessive speculation and excessive use of credit. The stock market was overvalued and a bubble had formed.

• October 24, 1929 - Black Thursday: The event considered to be the trigger for the Great Depression was the day known as "Black Thursday", which occurred on October 24, 1929. This day went down in history as a day when stocks on the New York Stock Exchange experienced a major collapse and many investors suffered major losses.

• Stock Market Collapse: The ongoing crash in the stock market following Black Thursday resulted in millions of dollars in asset losses in just a few days. Many investors went bankrupt, losing their savings, which eroded consumer confidence and reduced spending.

• Bank Bankruptcies and Credit Contraction: The collapse in the stock market also negatively affected banks. Bank customers started withdrawing their money, which caused many banks to go bankrupt. Bank failures led to credit contraction, making it difficult for businesses to access financing.

• Unemployment and Business Recession: Bank failures and general economic uncertainty caused businesses to close and unemployment rates to skyrocket. The number of people out of work has increased dramatically, and unemployment rates have risen to high levels.

• Agricultural Crisis: The agricultural sector was also affected by the Great Depression. Natural disasters such as drought and soil erosion in the USA have caused agricultural products to decrease and farmers to be in a difficult situation.

• Poverty and Difficult Conditions: During the Great Depression, many people faced unemployment, homelessness, and poverty. Families had difficulty meeting their basic needs and living conditions became difficult.

• New Economic Policies and Regulations: The Great Depression led to changes in economic policies and financial regulations. With New Deal policies, the US government took steps to stimulate the economy, reduce unemployment, and regulate financial markets.

The Great Depression refers to a period of economic collapse that began in 1929 and continued until the early 1930s. During this period, the United States and many other countries faced major economic difficulties. The Depression was characterized by factors such as stock market collapse, rising unemployment rates, bank failures, and general economic stagnation. The 1920s experienced rapid economic growth in America, but this growth was based on speculative stock trading and excessive use of credit. In 1929, a major economic panic began with the stock market crash. People lost their savings, businesses went bankrupt, and unemployment rates skyrocketed. The Great Depression caused economic shocks around the world and led to similar difficulties in many countries. This period caused changes in economic policies and financial regulations, triggering efforts to prevent future economic imbalances.

The Great Depression is historically considered an example of the potential effects of economic collapses. Experiences during this period have provided important lessons for economic policymakers in developing strategies to deal with similar situations in the future.