Imagine, living through an era where everything is going great and then BAM, you"re out of a job and you have no money. That horrific dream became reality for thousands of Americans in the 1930s. In October of 1929, the stock market unexpectantly crashed causing much ciaos. This crash would affect millions of Americans negatively. Would there ever be a resolution to this terrible situation? .
In the early 1920s Americas economy was at its best. At this time the stock market was really doing good. With the boom of the stock market Americans began to have an optimistic view of the economy. With this attitude Americans wanted to buy more. But most Americans did not have the money to buy goods that they wanted. Since the majority of the population did not have enough money to purchase these goods, the solution to the problem was to allow those who wanted these goods to purchase them on credit. A concept of buying and paying later was quickly adopted and by 1929, sixty percent of all cars and 80 percent of all radios were bought on this installment credit (Shepherd). Unfortunately with so many Americans taking advantage of this buy now pay later, the national debt rose. Between 1929 and 1929 the total amount of credit increased from 1.38 billion to over 3 billion (Shepherd).
When economist and stockbrokers thought that the economy was going great, something tragic happened that would affect Americans lives tremendously. On October 29, 1929 the stock market crashed causing stocks to lose 13 percent of their value. This came has a shock to Americans. The effects of this crash would not be immediate, but would come quickly. It didn't take long for Americans to feel the affect of this crash. The economy was down and people were not spending as much as they use to. This created a problem for businesses. If the businesses were not making a profit then they couldn't afford to pay their workers.