Great Depression

The United States has been through many national tragedies ranging from the attacks on Pearl Harbor, to the September Eleventh terrorist attacks but none were as widespread and effected more people than the Great Depression. The American population during the Great Depression was roughly 122 million people; at the peak of the Great Depression the unemployment rate reached a staggering 25%, leaving over thirty million people jobless. (1) These staggering numbers make the Great Depression one of the darkest times in United States history, and since history is cyclical it is important to know what caused the worst economic period in our history. The main causes of the Great Depression were the stock market crash, the bank failures, a lack of consumer purchasing, and the Dust Bowl.

The first major cause of the Great Depression began with what is known as the Stock Market Crash of 1929. The Dow Jones, the common measurement for the vitality of the stock market, was at an all time high of 381 points on the 3rd of September 1929. Under two months later on the 29th of October 1929 the Dow Jones fell to a dismal forty one points, this day would later be dubbed “Black Tuesday” and is known as the day the stock market had officially crashed. (2) This crash was caused mainly by speculation in the market, which causes many economic swings in our capitalist society. However this one was more extreme than any of the other dips in the economy. During the 1920’s the economy and mainly the stock market were increasing rapidly. The stock market had roughly quadrupled in value and the period was deemed the roaring 20’s due to the rapid boom. However, when periods of rapid expansion go unregulated the bubble has to burst eventually and that is what happened in the late 1920’s and early 1930’s, the stock market bubble burst. (2) Investors had been taking out loans from the banks in order to invest in what they thought was a sure thing in the stock market, however when the bubble...