Causes

Most believe the main cause of the Great Depression to be the stock market crash of 1929. This crash not only effected the United States, but the world. Stock holders lost more than $40 billion dollars- $537,078,362,573.10 if it were to happen in 2013. Because of this, more than 9,000 banks across the US failed because they were uninsured and people lost their savings. This is one of the reasons why older people today don't use banks.

Another reason why the Great Depression happened is because people from all classes stopped buying things which lead to stores closing down which then led to serious unemployment. Through the 1930's the unemployment rate was above 25%, 18% more than today's unemployment rate. Because of the lack of purchasing items, the American government came up with the Smoot-Hawley Tariff in 1930 which charged high tax for imports. This tariff failed miserably and led to less trade between America and foreign countries. 






Here's a link to a video about the stock market crash of 1929


Sources: http://americanhistory.about.com/od/greatdepression/tp/greatdepression.htm
              American History: Connecting With the Past by Alan Brinkley