The Great Depression was a severe economic disintegration symbolized in the United states by the stock market crash on "Black Thursday", October 24, 19291. One that affected virtually the entire industrialized world. The depression began in the late 1920s and lasted for about a decade. Many factors played a role in bringing about the depression; however, the main cause for the Great Depression was the combination of the greatly unequal distribution of wealth throughout the 1920's, and the extensive stock market speculation that took place during the latter part that same decade. The misdistribution of wealth in the 1920's existed on many levels. Money was distributed disparately between the rich and the middle-class, between industry and agriculture within the United States, and between the U.S. and Europe. This imbalance of wealth created an unstable economy. The excessive speculation in the late 1920's kept the stock market artificially high, but eventually lead to large market crashes.
United States
United States
United StatesThese market crashes, combined with the misdistribution of wealth, caused the American economy to capsize.
The "roaring twenties" was an era when the United States prospered tremendously. The nation's total realized income rose from $74.3 billion in 1923 to $89 billion in 19292. However, the rewards of the "Coolidge Prosperity" of the 1920's were not shared evenly among all Americans. According to a study done by the Brookings Institute, in 1929 the top 0.1% of Americans had a combined income equal to the bottom 42%3. That same top 0.1% of Americans in 1929 controlled 34% of all savings, while 80% of Americans had no savings at all4. Automotive industry mogul Henry Ford provides a striking example of the unequal distribution of wealth between the rich and the middle-class. Henry Ford reported a personal income of $14 million5 in the same year that the average personal...