Submitted by: Submitted by glnwh
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Words: 710
Pages: 3
Category: US History
Date Submitted: 07/08/2012 07:29 PM
Causes for the Great Depression
Glenda White
LA College International
HIS400X: American History
January 29, 2012
Causes for the Great Depression
The stock market had been on a roller coaster ride of ups and downs before it crashed on Black Tuesday in 1929. Everyone believed that the United States was a land of opportunity and anybody had the chance to get rich. Stock market investors were told that the market had reached a permanent plateau, so many people started investing recklessly in real estate after they were told that it was safe. They took many risks that, in the end, blew up in their faces. There were many factors that I believe led to this Great Depression because several things took place and one thing led to another, which caused it to last as long as it did. This paper will discuss my take on the Great Depression.
In the twentieth century, many people started buying stocks that they sometimes could not afford to own as the American economy grew at a rapid paste. Here, the big companies started buying up all the stocks and bonds when the economy was booming, but when it crashed, a lot was lost. All the monies that they had invested was gone because the when they tried to sell their stock, no one was willing to buy it and the stock market eventually began to fall into bankruptcy (Rosenberg, 2012).
Secondly, the U. S. economy depended only on the construction and automobile industries. When those industries slowed down by the end of the 1920s, the entire economy was affected. The automobile company had the tendency to do a lot of over production, which means they were producing much more than they were selling. The smaller businesses that didn’t bring in much money were overlook, I assume because they didn’t feel that counting them would be of any benefit to them. They only depended on the two most profitable companies which I think contributed to this downfall because when they stopped producing, everything began...