The Roaring Economy. Was Everything really getting better? The Normal Business Circle.

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Presentation transcript:

The Roaring Economy

Was Everything really getting better? The Normal Business Circle

Why was everything getting better? Government Fiscal Policies: ▫Laissez-Faire Economics  French for “Hands off”  Meant that there was little government intervention and businesses could do what they wanted ▫This helped ease the pain of losing the money we made selling war goods.

Why was everything getting better? Credit ▫It was really easy to buy things. ▫People would get credit and spend the money ▫People could buy their stocks on credit.

What Was Really Happening The Credit system was flawed ▫When they couldn’t pay the money back they went into debt. ▫The money that people spend was imaginary, because the banks didn’t actually have it either. When the govt. doesn’t regulate businesses, problems happen. ▫Companies reported their stocks were worth more than they actually were.

In Conclusion It really wasn’t getting that much better These problems would lead to the Great Depression

Roaring Economy Wrap Up What is Laissex-Faire economics? How did the concept of credit work? What were the long term consequences of these economic policies?