The Great Depression

The Great Depression was the worst and longest economic collapse in the history of the United States.It not only put the United States in depression from 1929 to the early 1940's, but also destroyed the rest of the World's economy.Franklin D. Roosevelt's confidence overwhelmingly won him the election in 1932, but significantly raised Americans' spirits with his new aggressive federal programs known as the "New Deal.""We Americans will rise from destruction; we Americans will conquer despair; we Americans are facing new things. With confidence we accept the promise of a New Deal" (Winslow p.51).
There are many plausible causes of the Great Depression.The biggest misconception is that the stock market crash of 1929 was the cause of the Great Depression, but in fact, there were bigger problems within the United States economy before the Great Crash.
One of the biggest problems of the economy was the Lack of Diversification.The United States economy was too heavily based upon Henry Ford's Model-T car.The mass consumption of consumer goods kept the economy relatively good throughout the 1920's.The fundamental problem was that prosperity for the U.S. economy would only continue if the demand for consumer goods grew as fast as the supply of consumer goods. "Production of industrial products, for the moment, had outrun consumer and investment demand for them.The most likely reason is that business concerns, in the characteristic enthusiasm of good times, misjudged the prospective increase in demand and acquired larger inventories than they later found they needed" (Galbraith p.179).In the late 1920's, the American consumers stopped buying and the economy started to suffer.
Second, the bad distribution of income led to the economy to a state of depression."In 1929 the rich were indubitably rich.The figures are not entirely satisfactory, but it s…


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