GD Causes

Question 1

Long-term economic problems

Answer 1

Agricultural: overproduction & falling prices
Decline of old industries: coal & textiles
Huge poverty of 40% americans living below poverty line

Question 2

Bank’s actions

Answer 2

Lack of regulation; ‘Laissez-Faire’
Irresponsible lending; 1929 alone $9 Billion for speculation

Question 3

Speculation

Answer 3

20 million americans owned shares (4 million in 1920)
600.000 speculators chasing short term prices (constant trade)
Rise in share demands, even for imaginary products

Question 4

Trade Problems

Answer 4

Prohibition: fall in taxes revenue
Decline of all industries
Protective tariffs retaliated: stop export of american goods

Question 5

Overproduction

Answer 5

Due to machinery, mass consumption / consumerism
Many americans already have goods (e.g radios, cars…)
Falling prices

Question 6

Rep policies

Answer 6

Rugged individualism
Laissez faire
Let trusts run industries- little regulation
Protectionism
No intervention in econ