The onset of the Great Depression

The Great Depression has become shrouded in mythology with the passing of time. For example, one historian writes:

There is a popular myth that the nation was struck unaware by the stock market crash of October, 1929 and the coming of the Great Depression, which ended the New Era and ushered in the New Deal. One is given a picture of a nation

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s being turned out" (p. 32). By the autumn of 1929, the financial pages of America were gloomy reports of 'heaviness' in automobiles and radios, slackening of the building trades, disappointment along the new frontiers of aviation. Much of America's productive effort and income had lately gone into luxuries and durable goods, whose purchases could be postponed without affecting daily needs" (Wechter, 1948, p. 9). When these goods would begin to pile up in warehouses, production would necessarily slow, and the unemployment rate would increase drastically. Another factor combined with overproduction as a prime cause of the Great Depression--the over expansion of credit. In an era of mass overproduction, the goods had to be sold somehow. "It was part of the foolishness of the time to argue that the surge in production was no problem, that a 'good salesman can sell anything.' In practice this meant that while the rich (and many who weren't rich) were speculating in stocks, zealous salesmen were encouraging a kind of mass speculation. Consumers of limited means were being persuaded to take products anyhow, the exchange being accomplished by an overextension of credit" (Manchester, 1973, p. 32). Installment buying became a wa
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Approximate Word count = 1993
Approximate Pages = 8 (250 words per page)

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