A WORLDWIDE DEPRESSION

1. In new Postwar democracies, there were frequent changes in gov’t. Little experience w/ democracies Many political parties which made unity difficult

2. In Germany, the Weimar Republic was weak from the start. No strong democratic tradition Many Germans blamed the Weimar Gov’t Humiliated by Versailles

3. Postwar Germany suffered from severe economic inflation. German Gov’t printed money for war experiences & reparations.

4. The United States had a flawed economy. Uneven distribution of wealth Declining demand for American goods

5. On October 29, 1929, the U.S. stock market crashed. Believing prices would drop, people tried to sell stocks. No buyers

6. A long depression followed the crash in the United States. Unemployment rates rose as industrial production falls Banks and Businesses fail

7. Collapse of the U.S. economy affected countries worldwide. Countries with war debt were dependent on American loans 7 investments American money was pulled out of Europe

8. In Britain, the National Gov’t rescued the economy. Passed high protective tariffs Increased taxes Lowered interest rates to encourage growth

9. In France, the Popular Front was formed as a coalition gov’t. Economic crisis in France led to Political instability

Relied on existing tradition of cooperation 10. Socialist gov’ts in Scandinavian countries dealt with the economic crisis successfully. Relied on existing tradition of cooperation Gov’t sponsored public works