The economic crisis of the great deppression in the early 1930's?

Question

which exact areas were affected by the great depression in the early 1930's?

Answer 1

The Great Depression was uniquely far-reaching. The economic collapse it brought on was caused by a combination - "a perfect storm" is the apt cliché - of real events that came together to cause dramatic price reductions, massive business closings and rampant unemployment that brought consumer spending to a full halt.

The Great Depression's roots stem from several sources:

* Severe drought in the midwest and midsouth that crimped the supply of food but also destroyed a number of family businesses

* Panic that caused bank runs which brought down a large number of financial institutions

* Financial contagion from overseas (England's economy collapsed the year before the Great Depression's official start)

* A loss of export markets due to overseas recession

* Tremendous losses on Wall Street, particularly in margin accounts that bankrupted families and became bad debts against the brokerage houses

* An incorrect monetary policy that shut off the sources of lending

  rather than enabling them

All of these factors could not happen together today. The FDIC would prevent bank runs (IndyMac being the rare exception). Export markets are strong. Crop failures can be remedied by bumper crops from overseas (consider that transporting perishable goods in the 1930s was unthinkable). And we no longer rely upon a gold standard - which would make us prone to deflation. We also are not locked into a fixed exchange rate regime, which isolates us from financial contagion (if one trader's currency collapses, the other's simply gets stronger).