What Caused The Great Depression Essay
Between 1929 to 1939, one of the most important economic events in American history created an economic slump that occurred in North America, Europe, and other areas around the world - the Great Depression. The Great Depression itself would have been prevented if enough people would have confronted the economic situation by fixing the problems in their minor state rather than waiting for them to intensify. This financial collapse was caused by three things: the credit structure of the economy, the debt structure, and America’s position in international trade.
During the 1930s, the general credit structure further weakened the American economy. Most American farmers went into debt due to the overproduction of crops and the low prices of farm products. Poverty-stricken and desperate, they had to finance the …show more content…
The loans they owed were too high for the countries to pay back since the European economy was unstable. Even though the European government was in deep distress, America dismissed the idea to lower or forgive the debts. However, the American government did make a proposition to Europe: they would offer to aid them with large loans so that their debt can be paid and done for. Europe found themselves in greater debt than before and a solution to this problem seemed almost nonexistent. Meanwhile, the United States placed high tariffs that made it almost impossible for Europeans to make money selling their products in the U.S markets. Now with no source of income, the European government found it very difficult to repay their loans. The falter in America’s debt structure could have been prevented if they would have not been so persistent on recollecting such large payments from Europe. They could have backed down and allowed the European government to pay back their debt after their economy became stable
During the 1930s, the general credit structure further weakened the American economy. Most American farmers went into debt due to the overproduction of crops and the low prices of farm products. Poverty-stricken and desperate, they had to finance the …show more content…
The loans they owed were too high for the countries to pay back since the European economy was unstable. Even though the European government was in deep distress, America dismissed the idea to lower or forgive the debts. However, the American government did make a proposition to Europe: they would offer to aid them with large loans so that their debt can be paid and done for. Europe found themselves in greater debt than before and a solution to this problem seemed almost nonexistent. Meanwhile, the United States placed high tariffs that made it almost impossible for Europeans to make money selling their products in the U.S markets. Now with no source of income, the European government found it very difficult to repay their loans. The falter in America’s debt structure could have been prevented if they would have not been so persistent on recollecting such large payments from Europe. They could have backed down and allowed the European government to pay back their debt after their economy became stable