Great Depression - 1929
Written on 9:03 AM by nitesh
1. During the 20's after the WW-1 production rose in industries, but incomes didn't rise in a similar fashion
2. Top .1% income was equal to the bottom 42% of the population
3. There was a huge imbalance or maldistribution of wealth
4. Fed government cut tax rates specially of the rich people
5. Increased production created an increase in supply as compared to the demand
6. People specially the poor were encouraged to buy on credit
7. Other factor which kept the economy up was lavish spending or luxury spending by the top 1% rich people
8. There were only two major industries around which the whole of the economy revolved - Automobile industry and Radio industry
9. During the world war one farming was encouraged as whole of europe and america was to be fed. Farmers were given high prices and were asked to buy more and more land. After the war the policies changed , farmers debt increased and prices tumbled
10. Automobile and Radio industry fell as they couldn't expand after some extent and with 70% of the population dependent on agriculture economy fell apart
11. US tariffs were very high for other countries to export to US and global trade which could have lifted europe, australia after the world war-1 was not much relevant
12. Shares also went high on speculation from 100 - 420 and any person could buy shares on credit , e.g by investing his $10 and getting $75 on credit he could have brought shares. Return were very high due to speculation .......... markets went high and high and one day fell and due to panic all started selling their shares
Great Depression had begun ...................................................
It is a summary of the article i read
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Great Depression
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