Abouts On The Great Depression :: essays research papers

Abouts On The bulky DepressionTo my amazement the enceinte Depression serves as a natural debating pointthat "justifies" or "refutes" discordant stinting policies. The Great Depressionand the New Deal are multiform topics that are open to many interpretations. TheGreat Depression was the worst sparing slump ever in U.S. history, and onewhich spread to virtuall(a)y all of the industrialized world.     Seeing the order in which events actually occurred dispels many myths active the Great Depression. One of the greatest of these myths is thatgovernment intervention was responsible for its onset. authentically massiveintervention began only under the presidency of Franklin Roosevelt in 1933, whowas curse in after the worst had already hit. Although his New Deal did non cureit, all the leading economic indicators improved during his tenure.     To understand the Great Depression, it is important to know the theoriesof John M aynard Keynes. Keynes is known as the "father of red-brick economics"because he was the first to accurately describe some of the causes and cures forrecessions and depressions.     In a normal economy, Keynes said, there is a circular flow of money. My expenditure becomes part of your earnings, and your using up becomes part of myearnings. For various reasons, however, this circular flow whoremonger falter. Peoplestart hoarding money when times become oaf but times become tougher wheneveryone starts hoarding money. This breakdown results in a recession.     To get the circular flow of money started again, Keynes suggested thatthe central bank, the Fed eonl have System, should expand the money supply.This would put more money in peoples work force (through the multiplier effect),inspire consumer confidence, and compel them to start spending again.     A depression, Keynes reckond, is an in particular severe r ecession inwhich people hoard money no matter how much the central bank tries to expandthe money supply. In that case, he suggested that government should do what thepeople were not start spending money. He called this "priming the pump" of theeconomy. I think that most economists believe that only massive U.S. defensespending in preparation for human being War II cured the Great Depression.     After the success of Keynes economic beliefs were proven, almost allfree governments around the world became Keynesian. These policies havedramatically reduced the severity of recessions since then, and appear to havecompletely eliminated the depression from those who companion such economic beliefsthroughout the world.                    Events of the 1920s     The Roaring Twenties were an era dominated by Republican presidentsWarren Harding (1920-1923), Calvin C oolidge (1923-1929) and Herbert Hoover(1929-1933). Under their materialistic economic philosophy of laissez-faire