The Depression spread rapidly around the world because the responses made bygovernments were flawed. When faced with falling export earnings theyoverreacted and severely increased tariffs on imports, thus further reducingtrade. Moreover, since deflation was the only policy supported by economictheory at the time, the initial response of every government was to cut theirspending. As a result consumer demand fell even further. Deflationary policieswere critically linked to exchange rates. Under the Gold Standard, which linkedcurrencies to the value of gold, governments were committed to maintaining fixedexchange rates. However, during the Depression they were forced to keep interestrates high to persuade banks to buy and hold their currency. Since prices werefalling, interest-rate repayments rose in real terms, making it too expensivefor both businesses and individuals to borrow.
(Roosevelt's average growth of 5.2 percent during the Great Depression is even higher than Reagan's 3.7 percent growth during his so-called 'Seven Fat Years!') When 1936 saw a phenomenal record of 14 percent growth, Roosevelt eased back on the deficit spending, worried about balancing the budget.
Bennett during The Great Depression | Canadian History
The Great Depression in Washington State Project is a multimedia website that explores this important decade. Here you will find detailed accounts of issues, incidents, institutions, and people, along with hundreds of photographs, documents, and news articles from the period. This site is one of a collection of based at the University of Washington in Seattle, which involve undergraduate and graduate students, faculty, and community members.
Life During the Great Depression- Teens - Errol Lincoln …
This page features two timelines: the first for general events of theRoaring 20s and the Great Depression, the second for leading economic indicators.
The importance of these timelines cannot be emphasizedenough. Seeing the order in which events actually occurred dispels manymyths about the Great Depression. One of the greatest of these myths isthat government intervention was responsible for its onset. Truly massiveintervention began only under the presidency of Franklin Roosevelt in 1933,who was sworn in after the worst had already hit. Although his New Dealdid not cure it, all the leading economic indicators improved on his watch.
But don't take my word for it -- here is the raw data:
The following timeline shows the order of economic events during the Great Depression. Notice the effect that deficit spending had on economic growth:
Receipts: Tax receipts as a percentage of the Gross Domestic Product
Spending: Federal spending as a percentage of the Gross Domestic Product
GNP: Percent change in the Gross National Product
Unemp.: Unemployment rate
What Life Was Like During the Great Depression
The Great Depression began in the United States but quickly turned into a worldwideeconomic slump owing to the special and intimate relationships that had been forgedbetween the United States and European economies after World War I. The United States hademerged from the war as the major creditor and financier of postwar Europe, whose nationaleconomies had been greatly weakened by the war itself, by war debts, and, in the case ofGermany and other defeated nations, by the need to pay war reparations. So once theAmerican economy slumped and the flow of American investment credits to Europe dried up,prosperity tended to collapse there as well. The Depression hit hardest those nations thatwere most deeply indebted to the United States, i.e., Germany and Great Britain. InGermany, unemployment rose sharply beginning in late 1929, and by early 1932 it hadreached 6 million workers, or 25 percent of the work force. Britain was less severelyaffected, but its industrial and export sectors remained seriously depressed until WorldWar II. Many other countries had been affected by the slump by 1931.