Economical Events that lead up to the Great Depression

A detailed Summary of Economical Events that lead up to the Great Depression

In the 1920's, things were really rocking in the US and around the world. The rapid increase in industrialization was fueling growth in the economy, and technology improvements had the leading economists believing that the up rise would continue. During this boom period, wages increased along with consumer spending, and stock prices began to rise as well. Billions of dollars were invested in the stock market as people began speculating on the rising stock prices and buying on margin.

The enormous amount of unsecured consumer debt created by this speculation left the stock market essentially off-balance. Many investors, caught up in the race to make a killing, invested their life savings, mortgaged their homes, and cashed in safer investments such as treasury bonds and bank accounts. As the prices continued to rise, some economic analysts began to warn of an impend

If there had been restriction placed in backing in investment in the stock market, and the manufacture of goods there might not have been such drastic consequences. All of these areas affected each other. If the changes had taken place gradually it might have not have caused the stock market to crash, run on the banks, and surplus of goods which cause tremendous unemployment.

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In industry, manufacturing was based on the excellent economy at the time. Perhaps a little caution would have been a good idea. It would have been better for manufacturers not too over produce, just because there was a downturn in the economy, which created a surplus.

Consequently industries such a farming, mining, textiles, and construction to have financial problems. Therefore businesses were not able to pay their debts,

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Approximate Word count = 595
Approximate Pages = 2 (250 words per page double spaced)

Category: History

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Economical Events that lead up to the Great Depression

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