The Great Depression began in 1929 to continue for about ten years, devastating not only the American economy, but economies across the world.
After World War I, there was a period of prosperity in America, but the realities of a weak economy brought this to an end.
At least in part, the Great Depression was caused by underlying weaknesses and imbalances within the U.S. economy that had been obscured by the boom psychology and speculative euphoria of the 1920s.
Because of failures in the banking sector and the stock exchange, the devastation was terrible and thousands lost everything.
There were multiple causes for the first downturn in 1929. These include the structural weaknesses and specific events that turned it into a major depression... In relation to the 1929 downturn, historians emphasize structural factors like massive bank failures and the stock market crash.
Though there had been some other moderate crashes before "Black Tuesday," things had improved, but not after the Stock Market Crash of 1929. People lost savings, jobs, homes, etc. The disenfranchised moved to find work. Many committed suicide. Bread lines were common, where people stood hours to get food. When housing was lost, people would build lean-to's if they were lucky enough to find materials to do so. Automobile manufacturers had hundreds of cars on the lot, money already invested in their assembly with no way to recoup their investment because no one could afford to buy a car. Farms that had done well selling food in the U.S. and Europe after the war that had invested large sums of money to buy new machines to plant and harvest crops by taking out loans, were decimated.
By 1933, it was clear that the depression was not a temporary situation. Unemployment sky-rocketed, farms were lost, the gross national product had plummeted, and those hit the hardest were people who were already poor.
By spring of 1933...unemployment had risen from 8 to 15 million (roughly 1/3 of the non-farmer workforce) and the gross national product had decreased from $103.8 billion to $55.7 billion. Forty percent of the farms in Mississippi were on the auction block on FDR's inauguration day. Although the depression was world wide, no other country except Germany reached so high a percentage of unemployed. The poor were hit the hardest.
Franklin D. Roosevelt tried very hard to turn things around in America with programs to assist its citizens, including "public works," "farm subsidies," and other projects to "restart the economy. He also continue to attempt to balance the budget, but it is believed not enough money was invested into the economy—at least until World War II. There is some disagreement as to how much the war was responsible in improving the economy, but it did help with unemployment.
The U.S. had suffered heavily after the Civil War and was, in some ways, still recuperating. When the 1930s rolled around, the entire country was financially connected, so what affected one part of the country affected the entire country.
Even with intervention by the government, unemployment continued—though it improved with only 15 percent of the work force still unemployed in 1939. After the onset of World War II, unemployment dropped quickly as factories in the U.S. were pressed to fill orders overseas for guns and ammunition. Once the U.S. became involved in World War II, the Depression was over.