Great depression (Essay Sample)

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On the black Tuesday, October 29th 1929, the stock market fell, stock prices fell and there was no hope of recovery. People tried to sell their stock but they were unsuccessful. This was the official beginning of the great depression. Many banks had also invested in the stock market and the closure of the market resulted in many banks starting to close too. This led to mass panic of bank clients who went on account withdrawal spree. Many industries and businesses lost their capital due to the closure of banks, people greatly reduced spending and many more businesses closed down. This led to people losing jobs
In the previous depressions, farmers were able to feed themselves on the food they produced on their farms. This time round, the great depression was accompanied by a serious drought. Continued overgrazing on the small farms had left the top soil exposed and loose to the winds, resulting in dust storms when the winds came. Most small farmers had acquired loans from the banks to purchase seeds, fertilizer and tractors, which helped cut on manpower costs. Since they could no longer produce food and farm products, they could no longer pay the loans. The banks were closing up and would do anything to recover the money lent out. This resulted in the banks taking possession of many people’s farms making them homeless and unemployed. (Jenny Higgins, 2007)
The widespread unemployment that resulted from the great depression led to the mass migrations of Americans within the country in search for jobs. People would board trains to other places and towns in search for jobs. Whenever a job was available, thousands of people would apply for it. Those who missed out on a job opportunity would hurdle up in shanty-towns known as "Hoovervilles”, build close to the cities. They were named after a president who had promised a better turn which never happened. The great depression indeed resulted in widespread poverty among the American people. Wage cuts and layoffs plagued almost all industries but especially the forestry and the mining industry. The government had to spend a lot on relief programs, since thousands had become homeless and jobless. Since the people in need were too many, the relief programs were never enough. Malnutrition became the norm of the time and many malnutrition related diseases like beriberi besides others spread rampantly. (Rosenberg J, 2007)
The statistics on the depression were adverse. In 1931, hundreds of people were admitted in hospitals suffering from starvation. Many banks went bankrupt and international trade slumped. In 1932, approximately a quarter of a million Americans had their homes taken away and many farmers lost their farms. 20,000 companies went out of business, industrial production, product prices, wages and share prices fell by more than 50%. At that time, 25% of American were unemployed. Many people were left to feed off dumpsites or begging. Some towns set up soup kitchens and charity handouts for those who could not find anything to eat. The government at the time did not know how to end the depression and President Hoover believed that the government was not supposed to interfere with business. Ev...