The Great Depression

When you forget your beans at home.

The Great Depression, also known as 8th Grade, is the most edgy year of someone's life. From this point on, you will only go down hill into the memes and tumblr pages. You WILL tell your parents that gaming is not a phase, and that "I need to be experimental like everyone else". You will also start to do what you think is cool amongst High Schoolers, but is really only done by the typical Sophomore Stoners who always sneak out of class to go to the Sophomore Juul Room. That's about it. That's The Great Depression.

The Great Depression, also known as the great grandfather to the Corona Pandemic. It was the worst economic downtown that lasted from 1929-1939 making each and everything depressing to look at just like how hard the stocks market got massacred at the time.

The title granted The Greatest Depressed person in the world by the rest of the depressed people sharing the world with his great majesty.

A Pack/Heard/Group of Swamp Donkeys.

*noun*; global economic collapse; in the USA, this began in 1929 and persisted to 1939; most other industrialized countries emerged from the Depression earlier.

During the Great Depression, unemployment reached over 25% in the USA, and those who had jobs suffered severe wage cuts. The index of industrial output fell over 53% from its high in July '29, while trade and capital markets plummeted to mere fractions of their former levels.

*What Happened*
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Many people imagine that the Stock Market Crash (Oct '29) and the Great Depression are the same thing. However, it took another three years for employment, bank failures, and declining industrial output to run its course.

In 1929 the USA had 25,000 banks. By 1933, 10,000 had either failed or been merged with another to avoid failure. At this time there was no FDIC, so depositors mostly lost their money.

Another phenomenon was plunging prices: the consumer price index fell 25% during the first four years. For businesses, this was a disaster, and forced them to lay off millions.


The Great Depression made farms in much of the Southwest unviable; ruined farmers fled to California or Washington, and their abandoned farms succumbed to the Dust Bowl. This was the single largest ecological disaster in recorded history.


*How It Happened*
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There are basically three main explanations for the Great Depression.
1. During the 1920's, there was a huge and growing disparity between rich and poor. The incomes of the great majority rose much more slowly than productivity, but this was masked by increased borrowing. People were able to borrow because the market value of their assets was larger than what they owed; but when a rash of defaults occurred, then the market value of assets plummeted, and people owed more than their assets were worth. Businesses had to lay off workers, which further reduced aggregate demand.

2. The Great Depression began as another minor downturn, but was made much worse by the failure of the Federal Reserve to respond adequately (see Milton Friedman & Anna Schwartz). While the Fed reduced interest rates, prices fell even faster, so real interest rates soared. This made a quick recovery impossible.

3. The financial markets (combined with Fed supervision) distributed capital badly; for example, speculative ventures in growing wheat in the Great American Desert, real estate in Florida, and so on. When this arrangement of productive resources failed, it constituted an extremely large technology shock. Subsequent policy intervention tended to withhold capital and labor from the most productive enterprises, making the depression deeper.

(Explanation 3 is the New Classical economics explanation; see Harold Cole & Lee Ohanian.)


*Roosevelt Administration*
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Franklin D. Roosevelt was elected by a landslide in 1932, and inaugurated 4 March 1933. The White House immediately used emergency powers to close, restructure, and re-open the nation's banks. During the first 100 days of the FDR administration, Congress passed the New Deal which greatly eased the impact of the Depression on the hardest hit.

The New Deal did not significantly hasten the end of the Great Depression, because it was too small to provide a meaningful fiscal stimulus. However, it did introduce many important programs to help those affected by poverty. The Depression had ended in most of the world by 1937; the US was mostly recovered by 1939, when World War 2 broke out.

A simile for getting hit with lightning while in last place in Mario Kart 64.

An emotions where you are feeling very depressed