A BRIEF Look at the Global Economic Depression

“The Great Depression”

Beginning in 1929 and lasting into World War II

Causes of the Depression of the 1930s

World economy was heavily influenced by

US loans and trade during & after WWI.

In the 1920s, the US economy boomed …then

• demand decreased for consumer goods (gap between rich and poor in the US)

• industry & agriculture overproduced as European nations rebounded after WWI which caused prices to decline & unemployment to increase

Causes of the Depression of the 1930s

• Individual, bank, and business debt increased drastically after the stock market crash in October 1929.

• When the US economy weakened, the world’s economy weakened

• Demands for payments by the US on international loans and reparations destabilized European economies.– (for example…the US loaned

money to Germany and Austria to pay war reparations to Britian and France who used that money to pay the US money it

borrowed during WWI)

The Results

• Banks failed . . . – Austria’s national bank

went bankrupt– All German banks

closed for a month– Over 2000 banks failed

in the US

• Agricultural and Industrial production dropped

The Results

• Unemployment increased and wages dropped– In US and Germany

unemployment reached 30%

– In Britain 2.8 million were unemployed

• Global Trade slowed– Value of exports from

Latin America dropped 50%

– Southeast Asian rubber exports dropped over 50%

– Japan’s total exports dropped 50%