Over the course of history, many events have triggered drastic changes in our everyday lives. Events such as the discovery of electricity, the attack on Pearl Harbor and the American Revolution have all shaped the United States and helped to make it what it is today. Another event and era in the history of the United States that has had a profound effect is the Stock Market Crash of 1929 and the subsequent Great Depression that gripped not only the United States, but the world.
The 1929 Stock Market Crash brought an end to the euphoria of Post World War I United States. The effect of the crash brought an end to a carefree life from the roaring twenties and caused families to lose their life savings, businesses closed and millions of people were suddenly without job or the prospects of finding a job. This massive economic depression would grip the world for many years and would create hardships for the majority of people.
Economy Before the Crash
The end of World War I was a joyous time around the world. The allied forces, led by the United States was victorious in defeating Germany creating an upbeat atmosphere. Because of the upbeat atmosphere, the economy was robust and people were enjoying themselves. The 1920's has been known as the roaring twenties, with lavish parties, extravagant outfits and bold new music and dances. The twenties were a decade where people had money to spend, and weren't afraid to spend it, because they believed they would only continue to make money. The stock market was also enjoying a strong upward trend, with no end in sight.
Events of the Crash
During the 1920's, the stock market and its investors enjoyed a streak of gains, with the overall value of the stock market increase by four times the value. However, the bull market that was enjoyed came to a crashing halt. On Thursday, October 24th, as day that has become known as Black Thursday, the stock market hit a severe bump, with nearly 13 million shares being traded, and the stock market value taking a sharp nose dive. On this one day, millions of Americans lost fortunes and panic began to set in to the nation and the world. This panic caused people to sell to salvage some money. Unfortunately, this was the beginning of one of lowest points in the economy of the world.
When the Stock Market crashed in 1929, this caused the values of the stocks of many companies to plummet. Without the value of the stocks in place, the companies lost their value and could no longer afford to stay in business. Thousands of businesses were forced to close or reduce their operations, which in turn forced millions of people to lose their jobs. With the businesses closed, people out of work and other factors, the United States were driven into a Great Depression. This economic depression would last during the 1930's and slowly started to recover by the 1940's.
End of the Depression
The Great Depression crippled the nation during the 1930's, with many people in poverty. The government during the thirties attempted to help the people with various plans to get people back to work. These plans such as the Work Progress Administration and President Roosevelt's New Deal helped to get people back to work. In addition, the government started to work to protect people's money in banks with the Glass-Steagel Act and other laws aimed to bolster the economy. By the time the United States entered World War II, the country was nearing recovery and with the wartime activities of building planes, ships and preparing for war, the activity gave the needed shot in the arm to pull the country out of depression.
Crash Prevention Methods
While the country has suffered through other crashes such as the crash of 1987, the government and the stock market has implemented measures to prevent any major occurrence that would cripple the economy. Now measures are in place that would shut the stock market down when dramatic losses occur. Also, the government has implemented measures to limit the possibilities of losses due to fraud and negligence. The Stock Market Crash of 1929 and subsequent Great Depression has tought the nation valuable lessons, which will be used to make sure that we never have to suffer through this again.
- Stock Market Decline - information on how the crash led to the Great Depression.
- Crash and Banking - informative article from the FDIC, which shows the relationship between the crash of 1929 and bank failures.
- Poverty in the 1920's - while the roaring twenties was known for its prosperity, it was also a time when others had to endure poverty.
- Prosperity Between Wars - helpful look at the country and its prosperity between World War I and II.
- The Roaring Twenties - pictorial website taking a look at the life in the 1920's.
- Roaring Twenties Information - resourceful collection of information on life in the 1920's.
- Twenties Economy - look at the economy during the decade of the 1920's.
- Causes of the Depression - helpful information showing the causes of the Great Depression.
- Rise and Fall of the Stock Market - article showing the stock market and economy before and after the 1929 crash.
- Stock Market Crash Causes - information on the events surrounding the 1929 Stock Market Crash.
- Events in the Depression - brief look at the events during the Great Depression.
- Financial Markets and the Depression - article showing how the financial industry was effected during the Great Depression.
- Great Depression Overview - a look at the events and the country during the Great Depression.
- Resources on the Great Depression - collection of helpful websites covering many topics of the Great Depression.
- Great Depression Information - helpful information discussing life during the Great Depression.
- After the Crash - information about how life was after the Crash of 1929 up until getting out of the Depression.
- Life in the Great Depression - descriptive website showing what life was like during the time of the Great Depression.
- Recovery from the Great Depression - look at the country and how it recovered from the Great Depression in the 1930's.
- Great Depression and the New Deal - information on the time from 1929 to 1941 and how the country rebounded from the 1929 Stock Market Crash.
- New Deal - information on federal programs from the New Deal that helped bring the United States back from the depression.
- New Deal Information - article providing further information and resources on President Roosevelt and the New Deal.
- President Franklin D Roosevelt - biographical look at the life of President Roosevelt.
- War on the Great Depression - archival information on FDR's Inaugural Address declaring war on the Great Depression.
- Recovery from the Great Depression - useful information on how the economy recovered from the Great Depression.
- Great Depression and the New Deal - information on the role of the New Deal in breaking the country out of the Great Depression.
- Ending the Great Depression - article showing what ended the Great Depression.
- Timeline of the Great Depression - useful timeline showing the events surrounding the beginning and end of the Great Depression.
- Crash Results - informative site showing what happened during the crash and how the country has responded.
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