Why The Great Depression Was Meant To Happen

Summary

This video explores the Great Depression, one of history's most devastating economic events, detailing its unexpected onset, widespread impact on employment, industries, and banking, and its ripple effects on society and culture. It discusses the role of the gold standard, the varied effects on different countries, and the significant changes in economic policies and social structures that emerged from the crisis.

Takeaways

• 🌐 The Great Depression was one of the most devastating economic events in history, with no one anticipating its occurrence.
• 📉 October 24, 1929, marked the beginning of the economic crisis with a record 12.9 million shares traded on the New York Stock Exchange, followed by Black Tuesday on October 29, 1929.
• 💸 The collapse in consumer spending and investments led to widespread unemployment and suffering, affecting not just the US but also the global economy.
• 🌍 The gold standard played a significant role in spreading economic troubles, particularly to Europe, as it tied various countries with fixed currency exchange rates.
• 🏦 Bank runs, where people rushed to withdraw their money, further destabilized the economy as banks had to liquidate loans and sell assets to gather cash reserves.
• 🇬🇧 Great Britain and France experienced less severe impacts compared to the US, while Germany was a major victim due to its dependence on US loans.
• 🌳 Less industrialized countries like Argentina, Brazil, and Japan fared better during the Great Depression, with milder declines in production.
• 🌾 In British India, peasants and craftsmen suffered, but landowners, urban workers, and government officials benefited from falling prices, increasing their purchasing power.
• 💼 Women's employment rose rapidly during the crisis, driven by economic necessity and the rise in the percentage of single women in society.
• 🏙️ The Great Depression led to significant cultural and societal changes, including the rise of realism in art and literature, and the growth of labor unions and welfare states.

Q & A

What is the Great Depression and why is it considered one of the most devastating events in human history?

The Great Depression was one of the longest and most severe economic depressions ever experienced in the Western World. It led to widespread unemployment, business failures, and a significant decline in consumer spending and investment. It is considered devastating because it had a profound impact on everyday life, with millions of people losing their jobs, industries shutting down, and banks collapsing.

What was the significance of October 24th, 1929, in the context of the Great Depression?

October 24th, 1929, also known as Black Thursday, was the day when a staggering 12.9 million shares were traded on the New York Stock Exchange. This marked the beginning of the stock market crash that led to the Great Depression, as it signaled a loss of confidence in the economy and triggered a series of events that resulted in a severe economic downturn.

How did the Great Depression affect the banking system and consumer behavior?

The Great Depression led to a collapse in consumer spending and lower investments, which in turn impacted the banking system. People lost confidence in banks and rushed to withdraw their deposits, forcing banks to liquidate loans and sell assets. This resulted in a domino effect of bank failures and further economic decline.

What was the role of the gold standard in spreading economic troubles during the Great Depression?

The gold standard played a significant role in spreading economic troubles, especially to Europe. It tied various countries together with fixed currency exchange rates. When the US economy tanked, the shock waves were felt worldwide, exacerbating the economic crisis in other countries.

How did the Great Depression impact different countries differently?

The impact of the Great Depression varied across countries. For instance, Great Britain was slower to fall into negative growth and suffered less, while France initially fared better but later experienced a significant downturn. Germany was a major victim due to its dependence on US loans. In contrast, less industrialized countries like Argentina, Brazil, and Japan fared relatively better.

What was the economic situation in the Soviet Union during the Great Depression?

Unlike other countries, the Soviet Union experienced rapid economic growth and significant industrial transformation during the Great Depression. Its command economy shielded it from international economic shocks, allowing it to continue growing despite the global crisis.

How did the Great Depression affect women and their employment?

During the Great Depression, women's percentage of total employment rose rapidly. Economic necessity and the rise in the percentage of single women in society drove more women to seek employment. However, most jobs given to women were low paying and service-related, such as nursing, teaching, and domestic work.

What were some of the social and cultural impacts of the Great Depression?

The Great Depression had far-reaching social and cultural impacts. It led to a shift in values, with a focus on simplicity and thrift. It also spurred cultural movements, with writers and artists reflecting the bleakness and despair of the time through journalism, photography, and eyewitness accounts of the struggles of the era.

How did the Great Depression influence economic policies and theories?

The Great Depression led to a significant shift in economic policies and theories. It paved the way for the expansion of labor unions and welfare states, and major economists like John Maynard Keynes gained influence. Keynes suggested that government intervention through increased spending, tax cuts, and monetary expansion could counteract economic downturns, laying the foundation for more activist economic policies.

Is there a possibility that the Great Depression could happen again, or is it already repeating itself?

While the exact conditions of the Great Depression may not be repeating, there are some striking parallels in current social and economic trends, such as rising homelessness, low-paying jobs, and a growing divide between the wealthy and the poor. Reflecting on the Great Depression can help us better understand potential future economic challenges.