On October 6th 1929, a huge downturn in the world economy happened – the Great Depression. It has a huge impact on the entire world. Experts say that the major cause of the Great Depression is the fall of the Stock market and the collapse of stock share. A stock market is a network of stock exchanges where people legally buy and sell traded companies, and stock shares are defined as the claim of a company’s properties. Between 1929 and 1932, worldwide GDP fell by approximately 15%. Destructive effects were seen in both developed as well as undeveloped countries with falling personal income, prices, tax revenues, and profits. In fact, international trade fell by more than 50%, unemployment in the U.S. rose to 23% and in some countries even rose as high as 33%.
During those years, countries like Germany, Brazil, and the economies of Southeast Asia all suffered. More specifically, the most vulnerable people suffered the most. The logic is simple: poor people already suffer in society. It is already a challenge for them to live on in the normal economic status, when there are more jobs. In comparison, when the Great Depression occurred, the unemployment rate grew to 23%, leading to less opportunities for the vulnerable. For this reason, these people are hit the hardest. Moreover, Farming communities and farmers suffered as crop prices fell by more than 60%. In fact, farmers’ income fell from a high of $16.9 billion in 1919 to only $5.3 billion in 1932.
In 1930, something other than the Great Depression happened – the Dust Bowl. This is another challenge for the farmers. They are forced to leave their farmlands because the Dust Bowl was too destructive. These Dust Bowl migrants mostly went to California since the new implemented immigration laws forced thousands of Mexican workers out of their jobs. Their absence created a hug demand for the Oklahoma migrants. Yet, only about 25% of the people moved from Oklahoma. The rest stayed to look after their farmlands, as it have once been their home. Those farmers faced huge obstacles like the lack of food, low prices of products, and the high unemployment rate. If I were the farmers, I would choose to move to California because there is a more stable income, as there are more job opportunities.
Today, there is still an economic recession, though caused by something different – the pandemic. In September 2022, the inflation rate is as high as 8.2% in the United States. In fact, the global inflation rate had surged up to 7.5% in August 2022. Inflation occurs when a country prints more money, but the assets stay the same. The pandemic also impacted the employment rate very much, as it pushed the unemployment rate to a high of 13% in the second quarter of 2020. Because of the Covid-19 pandemic, airline revenues dropped by 60 percent in 2020, and inequality increased as women in the workplace were particularly impacted, with the unemployment rate at 1.8 times more than men.
In conclusion, the Great Depression is mainly caused by the crash of the stock market. During those difficult times, the vulnerable suffered the most because they already suffered a lot and struggled to live in the normal society. So, when the conditions got worse, they suffered even more. In the 1930s, the Dust Bowl occurred. Farmers are forced to go to California because of the lack of resources in Oklahoma. Yet, only one out of four people went. The rest stayed to look after their homeland. If I were the, I would have gone because I would have a higher chance of surviving. Today, there are still inflation, while the recent one is caused by the pandemic. It has caused 8.2% inflation in America alone, and 7.5% inflation in the global economy.
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