The Great Depression of the 1930s still remains a threatening reminder of the high sensitivity of the American economy. The most dramatic economic downfall in the history of the US caused a broad financial damage to the country. Even families without most of their assets invested in the stock market felt a downfall, not to mention businesses and corporations that hardly survived. Though such a massive event did not happen overnight, the stock market crash of October 29, 1929, accelerated the national economic collapse. But Black Tuesday was merely the final part of the chain of processes that gradually destroyed the society of the early 20th century.
The 1920s was the period of false prosperity in the US. Many people used automobiles, telephones, and radio that were a luxury yet a decade before. This was the Jazz Age when television with all its celebrities prospered. The US gained dominance in the world as former global political superpowers tried to compensate for the losses brought by World War I. In the meantime, millions of Americans invested in shares, and banks stimulated their clients with generous loans. Despite the wide income gap in the society, becoming a rich man was easier than ever. And people took advantage of it. When speculation in the stock market pushed prices above the limit, a massive sell-off began. The actual price of bonds and shares fell to unimaginably low rates.
The Great Depression began as the majority of people lost their money and often a workplace. The purchasing power of Americans fell far below previous figures. People stopped purchasing items, and factories stopped their production. The government introduced harsh economic policies to reduce purchasing imported goods, but it neither benefited corporations nor international trade with Europe.