THE ROARING 20S 1920 1929
AMERICAN POLITICS IN THE 1920S
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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wages
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tariffs
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labor union membership
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build up of weapons
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Detailed explanation-1: -The Smoot-Hawley Act increased tariffs on foreign imports to the U.S. by about 20%. At least 25 countries responded by increasing their own tariffs on American goods. Global trade plummeted, contributing to the ill effects of the Great Depression.
Detailed explanation-2: -The Great Depression was the greatest and longest economic recession in modern world history that ran between 1929 and 1941. Investing in the speculative market in the 1920s led to the stock market crash in 1929, which wiped out a great deal of nominal wealth.
Detailed explanation-3: -According to a 1989 analysis by Milton Friedman and Anna Schwartz, the recession of 1920–1921 was the result of an unnecessary contractionary monetary policy by the Federal Reserve Bank. Paul Krugman agrees that high interest rates due to the Fed’s effort to fight inflation caused the problem.
Detailed explanation-4: -Old industries were in decline. Farm income fell from $22 billion in 1919 to $13 billion in 1929. Farmers’ debts increased to $2 billion. Sharecroppers were often destitute when cotton crops failed or prices fell.