Great Depression

The Great Depression was a worldwide economic collapse that struck the United States particularly hard. American economic output and prices fell dramatically from 1929 to 1933 while the unemployment rate reached an all-time high and stayed high for over a decade. Economic historians have concluded that the Depression was caused mainly by the flawed policies of central banks, including the Federal Reserve, in response to a malfunctioning international gold standard, although additional economic weaknesses and policy mistakes were involved. The response to the crisis was a permanently enlarged national government. If you body slam a physically fit economy, will it break? The answer from the Great Depression seems to be: Almost.

The U.S. economy grew strongly during most of the 1920s, spurred by robust productivity growth ...