The Great Depression in Canada
Summary
TLDRThe video script explores the Great Depression's impact on Canada, focusing on four key causes: the 1929 stock market crash, easy credit leading to over-investment, interdependent global trade exacerbating economic downturns, and the Prairie droughts worsening agricultural losses. These factors combined to plunge Canada into a severe economic crisis, highlighting the interconnected nature of global economies and the devastating effects of over-reliance on exports.
Takeaways
- 📉 The Great Depression was a significant economic downturn that greatly affected Canada, with specific causes often attributed to major events.
- 📅 Black Tuesday (October 29, 1929) marked the beginning of the Great Depression, as it was the day of the stock market crash that signaled the recession.
- 💹 Easy access to loans and the rapid increase in share values during the Roaring Twenties led to an unsustainable economic bubble that burst during the crash.
- 🏦 The stock market crash had a domino effect, causing banks to demand repayment of loans that many could not afford, leading to further economic instability.
- 🌐 The interwoven global economy meant that the economic downturn in the United States had a ripple effect on trading partners, including Canada.
- 🚗 Post-World War One industrial growth and the availability of consumer goods like cars and radios led to widespread borrowing to finance these purchases, which contributed to economic instability.
- 🌾 Canada's heavy reliance on the U.S. as an export market and for imports made it particularly vulnerable to the economic downturn in the U.S.
- 🌾 Wheat overproduction in Canada, due to the Prairies' agricultural boom, led to an oversupply that was exacerbated by the global economic depression.
- 🛃 Increased tariffs by other countries to protect domestic industries further reduced demand for Canadian exports, worsening the economic situation.
- 🌧️ The drought and subsequent agricultural crises in the Prairies, starting in 1928, devastated the farming community and contributed to the overall economic hardship.
- 🦗 Drought, grasshopper plagues, and crop diseases like rust led to poor harvests and reduced income for farmers, worsening the economic impact of the Great Depression.
Q & A
What is the significance of October 29, 1929, in the context of the Great Depression?
-October 29, 1929, is known as Black Tuesday because it was the day of the stock market crash that signaled the beginning of the Great Depression.
Why did people start selling their shares during the stock market crash of 1929?
-People started selling their shares as the share values decreased, in an attempt to withdraw their money and avoid losses, which led to a panic sell-off.
How did the easy availability of loans during the Roaring Twenties contribute to the Great Depression?
-The easy availability of loans allowed people to take on debt to buy shares and luxury goods. When the stock market crashed, many were unable to repay these loans, leading to bank failures and a worsening economy.
What role did the interwoven network of trade play in the spread of the Great Depression?
-The interwoven network of trade meant that the economic downturn in one country, like the United States, affected its trading partners, including Canada, due to the interconnected nature of the global economy.
How did the post-World War One economic boom and new inventions impact the economy before the Great Depression?
-The post-war economic boom and new inventions led to increased consumer spending and easy access to loans, which fueled a speculative bubble that burst during the Great Depression.
Why did the demand for grain decrease during the Great Depression, and how did this affect Canada?
-The demand for grain decreased because of the economic downturn in countries like the USA, which reduced their imports. This affected Canada significantly as it relied heavily on grain exports, leading to a loss of export markets and economic hardship.
What was the impact of increased tariffs by other countries during the Great Depression on Canadian exports?
-Increased tariffs by other countries encouraged citizens to buy domestically produced goods, which reduced the demand for Canadian imports and further exacerbated the economic crisis in Canada.
How did the oversupply of wheat in Canada contribute to the economic problems during the Great Depression?
-The oversupply of wheat led to a decrease in grain prices, which left Canadian farmers with less income. This, combined with the global economic downturn, worsened the financial situation for farmers and the overall economy.
What role did the drought and subsequent agricultural problems play in exacerbating the Great Depression in Canada?
-The drought and agricultural problems like grasshopper plagues and crop diseases reduced crop yields and increased the hardship for farmers. This, coupled with the economic depression, led to widespread poverty and unemployment among farmers.
What were the consequences of the high unemployment rate caused by the Great Depression for the Canadian workforce?
-The high unemployment rate made it even more difficult for people to find work, increasing poverty and social unrest, and putting further strain on the economy and government resources.
How did the economic conditions in the Prairie provinces of Canada change during the Great Depression?
-The Prairie provinces, once rich from grain exports, were severely impacted by the drought and the global economic downturn. The decrease in grain prices and the loss of export markets led to widespread destitution among farmers in these regions.
Outlines
📉 The Stock Market Crash and Its Impact
The first paragraph discusses the onset of the Great Depression in Canada, triggered by the stock market crash on Black Tuesday, October 29, 1929. It highlights how easy loans and the rapid increase in share values during the Roaring Twenties led to an unsustainable economic bubble. The subsequent rush to sell shares as their value decreased caused a sharp economic downturn. The interwoven global trade network meant that the economic shock in the United States affected its trading partners, including Canada.
💳 The Role of Easy Credit
This section delves into the role of easy credit in exacerbating the economic crisis. Post-World War One, industrial growth and the availability of consumer goods like cars and radios led to widespread borrowing. Banks granted loans without stringent checks on repayment capabilities. The reliance on increasing share prices and economic prosperity made the system vulnerable. When the crash occurred, banks faced defaults, and the easy credit system was revealed as a significant contributor to the economic collapse.
🌾 The Agricultural Crisis and International Trade
The third paragraph examines the agricultural sector's role in Canada's economic downturn. Canada's heavy reliance on wheat exports, particularly to the USA, made it susceptible to global market fluctuations. As the depression reduced demand for grain, Canadian exports suffered. Additionally, increased tariffs in other countries led to a preference for domestic products, further impacting Canadian farmers. The interconnectedness of economies meant that the USA's depression had a ripple effect on Canada and other nations.
🏞️ The Prairie Drought and Its Economic Ramifications
The final paragraph addresses the devastating effects of the drought in the Prairie provinces, which began in 1928. The lack of rainfall, strong winds, and subsequent topsoil erosion, along with plagues of grasshoppers and crop diseases like rust, severely damaged agricultural production. The already struggling economy due to the depression meant that the reduced harvests sold for less, leaving farmers impoverished and contributing to increased unemployment and the overall severity of the Great Depression in Canada.
Mindmap
Keywords
💡Great Depression
💡Black Tuesday
💡Stock Market Crash of 1929
💡Loans and Shares
💡Economic Recession
💡Interwoven Network of Trade
💡Industrial Growth
💡Easy Credit
💡Oversupply
💡Drought
💡Unemployment
Highlights
The Great Depression of the late 1920s and early 1930s greatly affected Canada.
Historians often attribute specific causes to major events, and the Great Depression is no exception.
This video will cover four major reasons for the Great Depression in Canada.
October 29, 1929, known as Black Tuesday, marked the beginning of the Great Depression with the stock market crash.
During the Roaring Twenties, easy loans and shares led to rapid increase in company values.
People stopped buying shares when they became too expensive and started selling them, causing a rush to withdraw shares and save money.
The stock market crash led to a reluctance to spend money, worsening the economic state.
Many American banks were hit hard by the recession and depression, affecting Canada's economy as well.
Interwoven global trade networks meant that economic issues in one country affected trading partners.
Post-World War I industrial growth and new inventions like cars and radios led to increased consumer spending and easy loans.
Banks granted loans without checking repayment capabilities, leading to a fragile financial system.
The availability of easy credit turned out to be detrimental to the world economy.
Canada relied heavily on the US as an export market and for imports, making it vulnerable to economic downturns.
Decreased demand for grain during the depression and increased tariffs affected Canadian exports.
Oversupply of wheat due to continued farming led to financial struggles for Canadian farmers.
The Prairie provinces, rich from grain exports, faced the devastating effects of drought and pests.
Drought, pests, and disease weakened crops and led to a sharp decline in grain prices, impacting farmers' livelihoods.
The correlation of the drought and the depression exacerbated the economic crisis in Canada.
Transcripts
the great depression of the late 1920s
and early 1930s greatly affected canada
historians have this habit of giving
major events specific reasons for
starting
and the great depression has not escaped
the fate of being labeled with specific
causes
this video will cover four of the major
reasons of the great depression in
canada
october 29 1929 became known as black
tuesday as it was the day of the stock
market crash of 1929
it signaled the recession that led to
the great depression
during the roaring 20s people had been
able to easily take
loans and shares in companies quickly
increased in value
once shares had reached a certain point
people stopped buying them because they
were too expensive
but started selling them to get their
money out as the shared values decreased
people suddenly rushed to withdraw their
shares so that they would not lose their
money and savings
afterwards they were reluctant to spend
their money and try to save it this
worsened the state of the economy
many american banks were hit hard by the
recession and following depression
in canada it was not quite as bad but
the united states canada and the rest of
the world had created an interwoven
network of trade
while this was good for getting and
selling a variety of products
it meant that what happened to one
country would affect all that country's
trading partners
the stock market crash of 1929 was a
huge event that led to the great
depression
after world war one the world grew
industrially and many new inventions
popped out on the market
items such as cars and radios were new
and popular
almost everyone went to own one people
now also began
having extra money to spend on these
luxuries and they took loans to help
cover the costs the banks granted these
loans with ease not really checking
whether people would be able to pay them
back on time or not
investors even took loans to buy more
shares the system worked as long as
share prices increased and the economy
was going well
but as soon as black tuesday hit banks
began demanding their money back only to
find
that people who owed the money were
unable to pay
those who held shares in the bank
withdrew them to protect their savings
leaving the banks broke if credit had
not been so readily available
the value of the shares would likely not
have increased so dramatically and the
banks would have had more reliable
investors
the availability of easy credit turned
out to be detrimental to the world
economy
the economies and countries around the
world became very intertwined after
world war one
shipping was faster than ever before and
countries relied on each other for
imports and exports
the usa had grown to become a powerful
nation with a booming economy
and canada relied heavily on this
country as an export market as well as
for imports
for example canada produced a lot of
wheat in the prairies
when the depression hit the usa the
world's demand for grain decreased
and canada lost a lot of export markets
additionally
other countries increased their tariffs
so that citizens would prefer to buy
products produced in their own country
as it was cheaper
canadian farmers continued to grow wheat
which led to oversupply of grain that no
one wanted
furthermore because countries depended
on each other so much
this meant that what happened to one
country would affect many other
countries as well
if during the 1920s canada had exported
and
imported few products they would have
been quite independent on the economic
scale and the depression in the usa
would not have hit canada as hard as it
did overdependence on exports to the usa
and other countries turned out to be a
calamitous mistake
and was one of the reasons why canadians
suffered during the great depression
during the 1920s the prairies had the
perfect conditions for growing wheat and
other grains
they were able to export lots of wheat
and the prairie provinces particularly
saskatchewan became rich
the first stages of the drought began in
1928 when there was much less rainfall
than in previous years
with every ensuing year the drought
worsened strong winds whisked away
topsoil and the lack of water made it
difficult to grow anything
soon plagues of grasshoppers swarmed the
land and ate those plants that managed
to survive the drought conditions
not only were the grasshoppers who
drought a problem a disease called rust
became prevalent
it weakened mature crops and caused them
to die what wheat and other grains could
be harvested by farmers sold for much
less than before due to the depression
this left farmers with very little money
and many tried to find work in cities
the jobless farmers increased the
unemployment rate making it even harder
for people to find work
the correlation of the drought and the
depression left hundreds of farmers
destitute and made the great depression
in canada worse
so there you have it four major reasons
of the great depression in canada
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