what led to the Great Depression?
The Stock Market Crash of 1929 was one of the major causes that led to the Great Depression. The initial crash in October 1929 led to continued losses, interspersed with occasional gains, but by the end of 1930, it had not recovered sufficiently and America entered the Great Depression. Bank failures throughout the 1930s led to banks being unwilling to create new loans. This exacerbated the situation and led to less spending. Nationwide sales of goods dropped across the board as individuals from all classes stopped purchasing items. This led to a reduction in the number of items being produced and subsequently, fewer jobs. As people lost their jobs, they were unable to keep up with paying for items they had bought on credit and their purchases were repossessed. Inventory began to accumulate. Lending institutions collapsed as debts went unpaid. The unemployment rate eventually rose above 25%, which meant even less spending to alleviate the economic situation. A change in America’s trade
