The Great Depression
A depression is a prolonged slowdown in buying and selling: Businesses are unable to sell all they produce. Stocks pile up, despite competitive price-cutting. Firms increasingly lay off workers or go out of business altogether. Because of the businesses laying off workers many people become unemployed and therefore, can not buy anything which leads to declines in sales. This leads to more firms closing and banks going bankrupt because they can not afford to cover their deposits. Everyone is helpless and can not find any way to support themselves let alone their families. The Great Depression was not the first depression our country has seen, but it's clear to see it was the worst. There were other depressions starting in the 1800's occurring all the way up to the Great Depression, such as The Banking Panic of 1819 and 1837. The cause of the Great Depression can be blamed on the Federal Reserve Board. Around the time of the Great Depression, government intervention in the economy had been higher then ever before. A special government agency, know as the Federal Reserve Board, had been set up to help prevent depression and their associated problems. The Federal Reserve Board was known as one of the last resorts to help
Roosevelt came into office, which is when things began to turn around for the better. But this only lasted for a few months. prevent banks from collapses, but at this time the Federal Reserve did not take the right steps and the economy went into another depression, the Great Depression. All this is what turned America around for the better. The Federal Reserve Board set below market interest rates and low reserve requirements that all favored the big banks. He thought if businesses kept their high wages, recovery would soon start. He did invent his own programs, to help recovery from the depression, known as the "New Deal. The government built new roads, parks, and dams to help create new jobs. He got started right away in ensuring Americans relief was on its way. Hoover also established relief programs; Congress passed the Hawley-Smoot tariff, and he set up the Reconstruction Finance Corporation which gave government credit to the banks so they could extend loans to clients. The stock market crash was the beginning of the Great Depression and the "New Deal" was what brought America out of the Great Depression. Some of these programs helped the American citizens gain their self-esteem back, decreased unemployment, the FERA revitalized many of the relief programs, the FDIC restore faith in the banks and Americans were not scared that they would lose their money, and the TVA helped farmers and created more jobs in one of America's least modernized areas.
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