Causes of the Great Depression

Of Mice nad men is set during the 1930s and follows two men (among others) who are suffering as a result of the Great Depression.  All of America suffered at this time from 1929 to 1939; the effects were so widespread that it even affected Europe and some argue led to the popular rise of extremism in Germany, finally resulting in World War Two.

1/ The Stock Market Crash, 1929
In 1929 more than $40 billion dollars was lost on the Stock Market and even though some recovery took place investors and the American people could not avoid the following Depression.

2/ Bank Failure
The crash of the markets led to the closure of 9,000 banks; people across the States lost their savings and many had to forfeit their properties to pay off loans.  OTher banks that survived were less keen on lending money and so businesses began to fail.

3/ Reduction in Purchasing
Because the public and businesses had less access to money, spending decreased which meant that situation began to spiral out of control as no money was changing hands, no one was able to make a profit and businesses weren't able to pay their workers which led to 25% of the country's workforce being unemployed.

4/ Smoot-Hawley Tariff
This tariff, or tax, was placed on imports in order to protect domestic purchasing, but just meant that those countries suddenly paying higher tax on sending their products to the States, responded in kind and so American exports suffered as well.

5/ Drought
In 1930 a drought in the Mississipi valley led to the sale and loss of farms in that region and was a contributing factor in the formation of the dust storms that coined the term 'The Dust Bowl' and covered 10 states, either totally or in part.