What caused the Great Depression?

History

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The Great Depression (1929–1939) was the worst economic downturn in modern history.

Causes: • Stock market crash (October 1929): Overspeculation and buying on margin created a bubble that burst • Bank failures: Over 9,000 banks failed, wiping out savings • Overproduction: Factories and farms produced more than people could buy • Tight monetary policy: The Federal Reserve raised interest rates instead of expanding money supply • Smoot-Hawley Tariff: High tariffs triggered trade wars, reducing global trade by 65%

Impact: 25% unemployment in the US, global GDP fell ~15%, recovery didn't fully come until WWII mobilization. Led to the New Deal programs and modern economic regulation.

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The Great Depression (1929–1939) was the worst economic downturn in modern history.

What caused the Great Depression?
History

This history question requires analysis of historical events, causes, and consequences. The detailed answer below provides context, evidence, and a well-structured explanation.

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The Great Depression (1929–1939) was the worst economic downturn in modern history. Causes: • Stock market crash (October 1929): Overspeculation and buying on margin created a bubble that burst • Bank failures: Over 9,000 banks failed, wiping out savings • Overproduction: Factories and farms produced more than people could buy • Tight monetary policy: The Federal Reserve raised interest rates instead of expanding money supply • Smoot-Hawley Tariff: High tariffs triggered trade wars, reducing global trade by 65% Impact: 25% unemployment in the US, global GDP fell ~15%, recovery didn't fully come until WWII mobilization. Led to the New Deal programs and modern economic regulation.