The Great Depression

On October 29, 1929, the New York Stock Exchange crashed when investors sold sixteen million shares in just one trading day. Just a year before that, Herbert Hoover had been elected U.S. president, and the nation was basking in the glow of an unprecedented economic boom. The stock market collapse, however, firmly placed the nation on the road to the Great Depression, and by 1933, the nation's unemployment rate was at about twenty-five percent. Historians and economists disagree over the cause of the depression: some have maintained that the crisis was a global event, exacerbated by Germany's inability to pay the reparations that England and France demanded for its role in World War I; others have blamed a decline in consumption by Americans; while others have pointed to overvalued stocks as the culprit.

The stock collapse did not affect the nation's economy all at once. Gradually, businesses...