There have been many economic depressions in history and these have often led to serious economic difficulties. The Great Depression, or Black Thursday, is known as the greatest economic crisis the world has ever experienced. It was an economic crisis in the United States between 1929 and 1939, and its effects were felt around the world. This crisis started especially as a result of the depreciation of stocks and resulted in a great economic collapse. This event, also known as Black Thursday, left a significant mark on history and has been considered one of the greatest crises in the history of the economy.
After the First World War, the United States of America grew stronger and became a great power in every field. In this period, unlike Europe, which was in a difficult situation, there was an increase in production in many sectors and this situation allowed the formation of a consumer society. With the increase in consumption, stocks also gained value and by 1929 the New York stock market grew rapidly.
From the middle of 1929, consumption started to decrease and as a result, an economic crisis was experienced. The crisis manifested itself for the first time on October 3, when the stocks of several large companies depreciated. This loss of value caused the crowds to panic and on Thursday, October 24, the stock market suffered a great collapse with approximately 13 million stocks sold in the stock market. Along with the collapse, Thursday, October 24, 1929, the day when the crisis first emerged, was called “Black Thursday”.
Causes of the Great Depression
The reasons such as the fact that the banks were established with a bad structure and there was no supervisory institution, and that the banks could not freely distribute and take back loans, led to the emergence of the Great Depression. In addition, the fact that approximately 200 large holdings own 50% of the US economy is another factor that led to this crisis.
The USA’s desire to receive the war reparations from England and Germany in gold after World War I, but the inability to collect the indemnity due to the gold shortage also contributed to this crisis.
With the collapse of the stock market, the collapse of the banks and the disappearance of people’s money in the banks reduced the consumption of the people and there was a period of economic depression that would last for many years as a result of the lack of money in the market. This crisis environment spread all over the world in a short time.
Consequences of the Great Depression
The collapse in the stock market led to the bankruptcy of banks and companies, leading to the growth of the economic crisis. The sharp decline in investments caused the unemployment rate to rise significantly. In 1931 alone, 6 million people were unemployed in the United States. Due to the crisis in the agricultural sector, 25% of the farmers lost their lands.
Between 1929 and 1932, half of the factories in the United States closed. The crisis spread to other countries in a short time, and the unemployment rate rose to 30%, especially in England and Germany. International trade volume decreased by 60%. This global economic crisis, II. It played an important role in the outbreak of World War II.
Effects on Turkey and Measures Taken
The 1929 World Economic Crisis also affected Turkey and led to the adoption of a statist economic policy in the country. Unemployment and foreign trade deficit increased due to the crisis, and the purchasing power of the people decreased.
Türkiye has taken various measures in this difficult period. These include the use of barter method in foreign payments, promoting exports and ensuring standards in export goods. In addition, quality control in export goods has been made compulsory and this task has been given to the Turkish Office. Thanks to these measures, Türkiye tried to get rid of the crisis with the least damage.
