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Great Depression

Updated: Wikipedia source

Great Depression

The Great Depression was a severe global economic downturn from 1929 to 1939. The period was characterized by high rates of unemployment and poverty, drastic reductions in industrial production and international trade, and widespread bank and business failures around the world. The economic contagion began in 1929 in the United States, the largest economy in the world, with the devastating Wall Street crash of 1929 often considered the beginning of the Depression. Among the countries with the most unemployed were the U.S., the United Kingdom, and Germany. The Depression was preceded by a period of industrial growth and social development known as the "Roaring Twenties". Much of the profit generated by the boom was invested in speculation, such as on the stock market, contributing to growing wealth inequality. Banks were subject to minimal regulation, resulting in loose lending and widespread debt. By 1929, declining spending had led to reductions in manufacturing output and rising unemployment. Share values continued to rise until the October 1929 crash, after which the slide continued until July 1932, accompanied by a loss of confidence in the financial system. By 1933, the U.S. unemployment rate had risen to 25%, about one-third of farmers had lost their land, and 9,000 of its 25,000 banks had gone out of business. President Herbert Hoover was unwilling to intervene heavily in the economy, and in 1930 he signed the Smoot–Hawley Tariff Act, which worsened the Depression. In the 1932 presidential election, Hoover was defeated by Franklin D. Roosevelt, who from 1933 pursued a set of expansive New Deal programs in order to provide relief and create jobs. In Germany, which depended heavily on U.S. loans, the crisis caused unemployment to rise to nearly 30% and fueled political extremism, paving the way for Adolf Hitler's Nazi Party to rise to power in 1933.

Between 1929 and 1932, worldwide gross domestic product (GDP) fell by an estimated 15%; in the U.S., the Depression resulted in a 30% contraction in GDP. Recovery varied greatly around the world. Some economies, such as the U.S., Germany and Japan started to recover by the mid-1930s; others, like France, did not return to pre-shock growth rates until later in the decade. The Depression had devastating economic effects on both wealthy and poor countries: all experienced drops in personal income, prices (deflation), tax revenues, and profits. International trade fell by more than 50%, and unemployment in some countries rose as high as 33%. Cities around the world, especially those dependent on heavy industry, were heavily affected. Construction virtually halted in many countries, and farming communities and rural areas suffered as crop prices fell by up to 60%. Faced with plummeting demand and few job alternatives, areas dependent on primary sector industries suffered the most. The outbreak of World War II in 1939 ended the Depression, as it stimulated factory production, providing jobs for women as militaries absorbed large numbers of young, unemployed men. The precise causes for the Great Depression are disputed. One set of historians, for example, focuses on non-monetary economic causes. Among these, some regard the Wall Street crash itself as the main cause; others consider that the crash was a mere symptom of more general economic trends of the time, which had already been underway in the late 1920s. A contrasting set of views, which rose to prominence in the later part of the 20th century, ascribes a more prominent role to failures of monetary policy. According to those authors, while general economic trends can explain the emergence of the downturn, they fail to account for its severity and longevity; they argue that these were caused by the lack of an adequate response to the crises of liquidity that followed the initial economic shock of 1929 and the subsequent bank failures accompanied by a general collapse of the financial markets.

Tables

Change in economic indicators 1929–1932[18] · Overview › Beyond the United States
−23%
−23%
Col 1
Industrial production
United States
−46%
United Kingdom
−23%
France
−24%
Germany
−41%
−33%
−33%
Col 1
Wholesale prices
United States
−32%
United Kingdom
−33%
France
−34%
Germany
−29%
−60%
−60%
Col 1
Foreign trade
United States
−70%
United Kingdom
−60%
France
−54%
Germany
−61%
+129%
+129%
Col 1
Unemployment
United States
+607%
United Kingdom
+129%
France
+214%
Germany
+232%
United States
United Kingdom
France
Germany
Industrial production
−46%
−23%
−24%
−41%
Wholesale prices
−32%
−33%
−34%
−29%
Foreign trade
−70%
−60%
−54%
−61%
Unemployment
+607%
+129%
+214%
+232%
Gold Standard Policies by Country[81] · Causes › Attempts to return to the Gold Standard
Australia
Australia
Country
Australia
Return to Gold
April 1925
Suspension of Gold Standard
December 1929
Foreign Exchange Control
Devaluation
March 1930
Austria
Austria
Country
Austria
Return to Gold
April 1925
Suspension of Gold Standard
April 1933
Foreign Exchange Control
October 1931
Devaluation
September 1931
Belgium
Belgium
Country
Belgium
Return to Gold
October 1926
Suspension of Gold Standard
Foreign Exchange Control
Devaluation
March 1935
Canada
Canada
Country
Canada
Return to Gold
July 1926
Suspension of Gold Standard
October 1931
Foreign Exchange Control
Devaluation
September 1931
Czechoslovakia
Czechoslovakia
Country
Czechoslovakia
Return to Gold
April 1926
Suspension of Gold Standard
Foreign Exchange Control
September 1931
Devaluation
February 1934
Denmark
Denmark
Country
Denmark
Return to Gold
January 1927
Suspension of Gold Standard
September 1931
Foreign Exchange Control
November 1931
Devaluation
September 1931
Estonia
Estonia
Country
Estonia
Return to Gold
January 1928
Suspension of Gold Standard
June 1933
Foreign Exchange Control
November 1931
Devaluation
June 1933
Finland
Finland
Country
Finland
Return to Gold
January 1926
Suspension of Gold Standard
October 1931
Foreign Exchange Control
Devaluation
October 1931
France
France
Country
France
Return to Gold
August 1926 – June 1928
Suspension of Gold Standard
Foreign Exchange Control
Devaluation
October 1936
Germany
Germany
Country
Germany
Return to Gold
September 1924
Suspension of Gold Standard
Foreign Exchange Control
July 1931
Devaluation
Greece
Greece
Country
Greece
Return to Gold
May 1928
Suspension of Gold Standard
April 1932
Foreign Exchange Control
September 1931
Devaluation
April 1932
Hungary
Hungary
Country
Hungary
Return to Gold
April 1925
Suspension of Gold Standard
Foreign Exchange Control
July 1931
Devaluation
Italy
Italy
Country
Italy
Return to Gold
December 1927
Suspension of Gold Standard
Foreign Exchange Control
May 1934
Devaluation
October 1936
Japan
Japan
Country
Japan
Return to Gold
December 1930
Suspension of Gold Standard
December 1931
Foreign Exchange Control
July 1932
Devaluation
December 1931
Latvia
Latvia
Country
Latvia
Return to Gold
August 1922
Suspension of Gold Standard
Foreign Exchange Control
October 1931
Devaluation
Netherlands
Netherlands
Country
Netherlands
Return to Gold
April 1925
Suspension of Gold Standard
Foreign Exchange Control
Devaluation
October 1936
Norway
Norway
Country
Norway
Return to Gold
May 1928
Suspension of Gold Standard
September 1931
Foreign Exchange Control
Devaluation
September 1931
New Zealand
New Zealand
Country
New Zealand
Return to Gold
April 1925
Suspension of Gold Standard
September 1931
Foreign Exchange Control
Devaluation
April 1930
Poland
Poland
Country
Poland
Return to Gold
October 1927
Suspension of Gold Standard
Foreign Exchange Control
April 1936
Devaluation
October 1936
Romania
Romania
Country
Romania
Return to Gold
March 1927 – February 1929
Suspension of Gold Standard
Foreign Exchange Control
May 1932
Devaluation
Sweden
Sweden
Country
Sweden
Return to Gold
April 1924
Suspension of Gold Standard
September 1931
Foreign Exchange Control
Devaluation
September 1931
Spain
Spain
Country
Spain
Return to Gold
Suspension of Gold Standard
Foreign Exchange Control
May 1931
Devaluation
United Kingdom
United Kingdom
Country
United Kingdom
Return to Gold
May 1925
Suspension of Gold Standard
September 1931
Foreign Exchange Control
Devaluation
September 1931
United States
United States
Country
United States
Return to Gold
June 1919
Suspension of Gold Standard
March 1933
Foreign Exchange Control
March 1933
Devaluation
April 1933
Country
Return to Gold
Suspension of Gold Standard
Foreign Exchange Control
Devaluation
Australia
April 1925
December 1929
March 1930
Austria
April 1925
April 1933
October 1931
September 1931
Belgium
October 1926
March 1935
Canada
July 1926
October 1931
September 1931
Czechoslovakia
April 1926
September 1931
February 1934
Denmark
January 1927
September 1931
November 1931
September 1931
Estonia
January 1928
June 1933
November 1931
June 1933
Finland
January 1926
October 1931
October 1931
France
August 1926 – June 1928
October 1936
Germany
September 1924
July 1931
Greece
May 1928
April 1932
September 1931
April 1932
Hungary
April 1925
July 1931
Italy
December 1927
May 1934
October 1936
Japan
December 1930
December 1931
July 1932
December 1931
Latvia
August 1922
October 1931
Netherlands
April 1925
October 1936
Norway
May 1928
September 1931
September 1931
New Zealand
April 1925
September 1931
April 1930
Poland
October 1927
April 1936
October 1936
Romania
March 1927 – February 1929
May 1932
Sweden
April 1924
September 1931
September 1931
Spain
May 1931
United Kingdom
May 1925
September 1931
September 1931
United States
June 1919
March 1933
March 1933
April 1933

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