Australian History/1930s

The Great Depression

During the Great Depression a large number of people lost their jobs and were left with large debts that they could not pay off. The depression started on the 24th of October 1929. At the beginning of 1929, small investors in the American markets started selling off their stock. This lead to a small drop in the share prices. This small decrease in the price continued until October 24 where 13 million shares were sold at greatly reduced prices. This lead to a downward spiral of economic death. There is much speculation why the Great Depression happened in the first place. The most popular theory is that playing the share market had become another fad. People were buying without really knowing what they were buying. This pushed the shares much higher than their real value. When they started to collapse, people started to panic and tried to get out before the lost all their savings. This then slowly spread across the world. Australia who was in lots of debt was perhaps hit hardest. People lost their jobs, their houses, and nearly everything they owned. The Newly elected American President, President Hoover, came up with a plan to halt this economic spiral. His plan was called New Deals and incorporated the thinking that if he started employing lots of people to build government funded buildings, the economy might jump-start. To start with, he shutdown all banks until they could declare that they were financially stable. His plan worked, and it’s President Roosevelt who we need to thank for our modern day good and prosperous economy.