Great depression (Essay Sample)

STUDENT NAME LECTURER COURSE DATE The Great Depression The stock market crash was considered the worst economic event in world history. It Started on Thursday October 24, 1929 by timid investors. During the early 1920s, the American economy and stock market experienced rapid expansion. The flow of money has increased six times since August 1929, when leading economists such as Irving Fisher concluded and described the relationship between inflation and real and nominal interest rates, which stated that stock prices have reached what appears to be a permanently high plateau. Moreover, the overall economic climate in the US was healthy in the 1920s. Unemployment decreased, the auto industry grew at a high rate. Several causes of the 1929 market crash often debated among economists are widely accepted theories that speak to these causes. When the market crash occurred, President Hoover was unprepared for the scale of the Depression, and his limited response did not begin to help millions of Americans in need. The steps he took were very much in line with his philosophy of limited government, a philosophy that many people shared with him until the Great Depression hit. It was clear that a more direct government response was needed to resolve the situation. However, Hoover was stubborn in his refusal to hand out materials when he saw direct government aid. The steps Hoover took were too late to help the citizens and instead he created programs for the people. Several programs created through the New Deal had no lasting positive impact on the American economy, which slumped during the 1930s, among them the Social Security Act, which provided income for the elderly, disabled, and children of poor families. The Glass-Steagall Act of 1933 established the Federal Deposit Insurance Corporation, effectively insuring Americans' savings in the event of a bank failure. a failure that was all too common at the time. In addition, Lichtenstein notes, the National Industrial Recovery Act was passed in 1933 to promote equity through price and wage fixing, determination of production quotas, among other measures. The US economy has slipped into serious trouble, leading to the closure of many banks and businesses. At one time, nearly one in four people in the American labour for...