October 29, 1929; Most people know this day as “Black Tuesday” because it was a big part of the start of the great depression. On that Tuesday the stock markets crashed and all the money that people invested into the stocks were lost. Over speculation on the stocks meant that the price of a stock or share of a company was overvalued by buyers and sellers. People thought that because the stocks were a good way to get money back in the long run and they decided to borrow money from the banks and hope for the best. Because of black Tuesday, people were panicking because they lost all their money in the crash of the stock markets. So everyone went to the bank to get back the money they used to pay it back which ended up with the banks losing all their funds. Which then ended up with the collapse of the financial system. Companies lost profit which lead to having to cut workers, which led to less income, then led to people purchasing less goods. The great depression lasted throughout the 1930s till the start of world war II.
The war ended up saving Americans from their depression period. Due to the people enlisting and the jobs that were left due to the high enlistments for war. It opened tons of jobs for the unemployed men and woman and the financial system started flowing again. They had a goal and that was to work to help the country win the war. Because of Germany doing what they did, gave us a common goal and people left their jobs for war.
President Franklin D. Roosevelt’s “New Deal” also helped construct the new financial system. It basically involved the government in the American economy a lot more than it was before by having a national bank and having a four-day bank holiday to give them time to pass reform legislation and then to open them up again if they were capable. They had the national bank manage the money in all the banks. Today the FDIC insurance on bank accounts exists because of FDR and the NEW DEAL. Sure enough after world war II, the cold war and the baby boom generation continued to help the economy. People needed products and so the factories and companies began to produce and the balance of supply and demand returned. Thankfully we had a strong President and willing Congress to lead us out of depression with the New Deal and into a new horizon of global economics.
january25 • Dec 9, 2015 at 9:20 am
This article is well written and explains the Great Depression and the one of the biggest conflict that people were facing which was money. I like how briefly it was summarized and how clear the article is. I Learned that the New Deal did make a difference and until nowadays its been going on and how its been keeping the situations fair and equal.
http://www.history.com/topics/great-depression
Here’s a link that I found that would be interesting to take a look at because it also includes a lot of other conflicts the economy was facing during the Great Depression.