The Great Depression

A crowd builds outside the New York Stock
Exchange after the crash

Great Depression

The great depression was a worldwide economic depression in the years after WW1 and before WW2. The great depression began on October 29th, 1929 when the many stock exchanges including the New York Stock Exchange crashed. This day was also known as Black Tuesday. The Great Depression was the largest economic downfall in the 20th century. The crash devastated many countries around the world including Canada. Canada was already ravaged by the dust bowl, and the stock market crash didn't help. The Canadian national income fell to 56% of the level it was at before the crash and its unemployment rate reached 27%, many other countries including the United States had similar statistics.  Many people believed this was just a small phase and that the economy will be back to its normal  in no time, unfortunately they were wrong. The years of the Great Depression were from October of 1929 to September of 1939, the start of World War Two. Because of the start of a new world war the economy around the world began to rise and get closer to its levels pre 1929, as the world was now switched over to a wartime economy. But what could have caused such a devastating crash in the stock market?

There were many factors and variables in play that lead to the  start of the Great Depression, But the main reasons were; 

1. Over Production and Over Expansion- Canada had such an economic boom that many people immigrated from the United States to Canada to get work, but this caused a problem, as work was found and factories and farms began to increase it production output, they began to create more supply than there was a demand for causing prices in commodities to decrease.
2. High Tariffs constricting international trade- High taxes in International trade, many countries found ways to save money by producing their own products instead of importing, causing countries to produce less products.
3. Credit buying of stocks- As the stock market was at an all time high many people were buying stocks with credit cards hoping that the stock would double or triple and that they would have enough money to pay the bank back and still have a profit. However in most cases the stock didn't double or triple and people were left debts that they never had the money to pay in the first place, causing people to lose money and causing banks to lose large sums of money.

The Great Depression was a terrible time for everyone who had lived through. It was devastating and a low point in human history, who knows how long it would have lasted if World War Two had not began. It was bitter sweet, as one terrible time passed another began.