CHEM 1201 Chapter : Ch2ok
Document Summary
Describe and discuss the cause of the great depression. Causes of the great depression: lack of diversity, overproduction of goods, unequal distribution of wealth and income, poor banking practices, government missteps, unstable international debt structure. The depression was caused by several factors, which included poor policies and practices, and economic flaws. In the 1920s, the american economy was becoming consumer orientated. When the stock market crashed on october 29, 1929, the loss of savings, purchasing power, and employment stifled the new economy. Further, many factories produced a surplus of goods. Americans lived on the edge of subsidence because of an unequal distribution of wealth and income making the depression severe. In addition, the banking system was unstable in the 1920s. It was common for banks to fail, which magnified the impact of the crash. Also, banks would use depositors" money on stock credits and risky loans. When the stock market failed, thousands of people lost their savings.
