1. Depression - a period of low economic activity and high unemployment
Recession - a period of temporary economic decline during which trade and industrial activity are reduced
Hyperinflation (HI)– out of control inflation
Inflation – prolonged increase in the price level of goods and services

2. The Great Depression
Started in Europe

3. Worldwide event

4. Causes
Severe War Damage

5. 2. Heavy money penalties against Germany

6. (With German money – expenses still increase)

7. Soldiers come home – replace workers – led to increase in unemployment

8. Germany

9. Heavy Fines
Lost land and resources to Treaty of Versailles

10. Met Great Britain & France’s goal – Germany cannot start another war

11. Germany’s weak economy hurt trade and production in W. Europe

12. 1923
France seizes Ruhr Valley – Germany’s main industrial region

14. Germany cannot become economically viable
Germany cannot make war payments

15. Germany starts to print a lot of money with no economic support

17. Caused hyperinflation -devalued money across Europe

19. The depression in the 1930s was a __________________.
What led to the worldwide depression?
After World War I, Germany printed money it didn’t actually have in order to pay war reparations. Across the European continent, the value of money decreased and the price of goods increased. What is this known as?
Define inflation –

20. To help ensure Germany’s recovery
Dawes Plan 1924
To help ensure Germany’s recovery

21. Reduced reparations Germany owed
Set payments that Germany could handle
American investors lend $200 million to Germany
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22. Europe

23. Nations not buying or investing in foreign goods

24. US acts as bank for Europe (Germany best customer)

25. US economy goes bad – asks for full payment of loans and stops lending

26. European economies start to suffer – can no longer trade
Africa, Asia, S. America start to decline

27. Which country loaned money to European nations to help pay for WWI reconstruction?