The great economic depression
The First World War Gender Severe Economic Results by creating an international economic disorder in the second half of the 19th century. Economically, this conflict carries Europe to an excessive expense that was funded by public debt, both external and internal that created the increase six times more of the debt that already existed. On the other hand, money creation was carried out, generating great inflation.
Throughout the war, countries that were not involved in this one like Japan and the United States, appropriated certain international markets, which were mostly controlled by Europeans, which at that precise moment focused their industry on productionmilitary. At the end of the First World War, great economic growth in the United States, which relegate Britain of being the world economic leader is experienced. In the course of the 1920s, the economy of the United States expanded rapid.
The stock market, focused on the New York Stock Exchange on Wall Street, was the scene of a reckless speculation, where all, from millionaire magnates to chefs and conserves, poured their savings into shares. As a result, the stock market experienced rapid expansion, reaching its maximum point in August 1929.
By then, production had already decreased and unemployment had increased, which made shares prices much higher than their real value. In addition, wages at that time were low, consumer debt was proliferating, the agricultural sector of the economy had difficulties due to drought and fall in food prices, and banks had an excess of large loans thatThey could not settle.
The US economy entered a slight recession during the summer of 1929, since consumer spending slowed down and the unveiled goods began to accumulate, which in turn decreased the production of the factory. However, the prices of the actions continued to rise, and for the fall of that year they had reached stratospheric levels that could not be justified by the expected future profits.
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