Causes of the Great Depression. Basic Economic Principles Overproduction Dependence on Exports Tariffs and US Protectionism WWI Debt Stock Market Speculation. Basic Economic Principles. Oct 29 th 1929 Marked the beginning of a recession which progressed to a decade long Depression.
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Basic Economic Principles
Dependence on Exports
Tariffs and US Protectionism
Stock Market Speculation
Prices are determined by Supply and demand
- Ex Wheat during WWI
WWI and the Boom of the 1920s caused massive expansion in industry
When the economy slowed down, many companies faced overproduction
Layoffs meant fewer people could afford to buy consumer goods so sales slowed down more!
GERMANY WAR REPERATIONS!!
Many investors bought “on margin”
As a result Stock prices fell
Oct 29th 19129 Black Tuesday
New York Stock Exchange collapsed
- Caused world wide collapse