What was the financial crisis in the 1930s?

Comparison between American financial crisis in 1930s and current financial crisis.

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The economic crisis of the 1930s was like purgatory.

When studying history, senior historians often come to a conclusion: history is a film that repeats itself constantly, and many plots are strikingly similar. When faced with the economic crisis sweeping the world today, people's question is whether the world today will repeat the whole process of the economic crisis in the 1930s.

The global economic crisis in the 1930s began in the United States. Since the 20th century, there have been several crises in the United States, namely 1900, 1907 and 1920 to 192 1. Then in the 1920s, there was a brief prosperity in America.

But from 1929, the nightmare of the United States and the western world began. 1929- 1933 The Great Depression left a painful memory for Americans. In this four-year economic crisis, the losses of securities holders reached as high as $26 billion, and the hard-earned money of thousands of ordinary Americans went up in smoke. The main features are:

First, the economic downturn. Since the mid-19th century, the output of major products in the United States began to decline, some factories were underemployed, workers' unemployment began to increase, national income fell, consumption was insufficient, consumption index fell during the economic crisis, and annual GDP grew negatively. The GDP of the United States from 1929 to 1933 is 314,285,263,226 respectively.

Second, the chain reaction of the stock market crash. From June 1929 to June 1933, the US stock market plummeted by 85%. Among them, commercial banks have been hit hard. Before the stock market crash, most of the bank's assets, securities assets, were illiquid, and residents urgently needed money to live during the economic downturn. Some small banks can't respond to depositors' withdrawals in time, and the crisis of small banks began to spread to big banks until the whole financial system. In the face of a run, banks can only go bankrupt, during which thousands of banks closed down!

Third, the unemployment rate is extremely high. From the age of 29 to 33, GNP dropped by 30%, and the unemployment rate rose from 4% to 33%. This is a terrible number. Because of the bankruptcy of the bank, the American people's life savings became zero, and with unemployment, they could not survive at all.

Fourth, insufficient investment. Net investment is negative growth, that is, investment has declined year after year. Not only that, but also the end of the original investment, such as factory closure, idle machines, aging and mildew of raw materials piled up in warehouses and so on.

This is an overview of the so-called Great Depression in the 1930s. In fact, the situation is quite tragic. Therefore, when I saw Greenspan say that the current economic crisis is the worst crisis in 100 years, I really had an ominous feeling in my heart. If people saw the real economic crisis in the 1920s, they would have a new understanding of Greenspan's words.

During the Great Depression, 10937 1 American enterprises went bankrupt, and the net profit of private companies dropped from $8.4 billion in 1929 to $3.4 billion in 1932. 193 1 year, the total index of American industrial production decreased by 53.8% compared with 1929. The production reduction of heavy industry is particularly serious, especially the decline of steel, automobile and construction industry, which are all signs of the economic prosperity of the United States in the 1920s.

At the beginning of 1933, four days before the death of former President Coolidge, he lamented: "Looking around, there is no hope." Even franklin roosevelt, who has always been optimistic about life, exclaimed when he saw the collapse of the Bank of Maryland. "I wonder if this cardboard house will collapse?"

Due to the shrinking of industry, agriculture and commerce, by March of 1933, there were17 million completely unemployed workers in the United States, and countless semi-unemployed workers. The cash income of farmers dropped from $65,438+062 to $48 per year, and about 65,438+0,065,438+0.93 million farmers went bankrupt, becoming tenant farmers, joint-stock farmers and farm labourers, and many middle-class people also went bankrupt.

During the crisis, on the one hand, overproduction and tight consumption led to a backlog of goods; On the other hand, ordinary Americans are well-fed and living in poverty. In order to maintain the price of agricultural products, agricultural capitalists and large farmers destroyed a large number of "surplus" products, used wheat and corn instead of coal as fuel, and poured milk into the Mississippi River, turning the river into a "galaxy".

Due to people's general lack of confidence in the future, social morality has further deteriorated, and cases of theft, fighting and murder have emerged one after another. At that time, President Hoover once asked comedians to relieve people's psychological pressure by giving them laughter, but as a result, a large number of jokes made fun of him appeared in society. For example, the homeless in the city built a simple shelter with wooden boards, old iron sheets, tarpaulins and even kraft paper. The village where huts gather is called "Hoover Village", the beggars' bags of vagrants are called "Hoover Bag", the cars pulled by animals because they can't afford fuel are called "Hoover Car", and the newspapers built by vagrants sleeping on street benches are called "Hoover Carpet". A children's song is popular in the streets of new york, "Mellon whistles and Hoover rings the bell. Wall Street signals that the United States is heading for hell! "

According to the estimation of Happiness magazine in September 1932, there are 34 million adults, men, women and children in the United States, accounting for about 28% of the total population of the country. They can't make a living (excluding rural population 1 1 10,000), and the homeless population reaches 2 million, only in new york. The children born in this period were short in stature and later called "the depressed generation". There are 330,000 out-of-school children in the United States, and girls risk getting pregnant, soliciting customers on the streets to support their families at the price of 10 cents. Due to long-term malnutrition, the United States needs to recruit a large number of soldiers to participate in World War II, and 40% of the soldiers were eliminated because of their unqualified physique!

On Roosevelt's inauguration day, Hoover sent a message to the new government, "We are at the end of our tether."

The Great Depression, which lasted for four years, made people doubt the capitalist system. Arnold Tong, a famous British historian, raised such a question on the first page of An Overview of International Affairs published in 1932. "Members of this great, ancient and always successful society are asking themselves: Is it possible for the long-term process of western life and its development to end in their time?"

I think it is worth studying the different coping strategies adopted by western countries in the face of the Great Depression and their consequences. To sum up, the west is the two major coping strategies.

The United States implemented Roosevelt's "New Deal" based on Keynesianism. By strengthening government control, the government can invest in coping with the economic crisis. I don't need to say more about this.

Some western countries, led by Germany, are planning to get out of trouble through war. At that time, Germany's GDP ranked first in the world, and there was overcapacity in the economic crisis. At this time, fascist organizations appeared in Germany, Japan, the United States, Britain and France. The German Nazis seized power under Hitler's plan. The slogan of German fascism is "strive for international space for Aryans". There have also been many military coups in Japan, and finally the fascist rule of the army was established. Germany and Japan, together with the Italian fascist regime Mussolini who came to power shortly before the Great Depression, brought the world to the brink of war.

The wily western countries such as Britain and France adopted the policy of "appeasement" at the expense of others, trying to lead the disaster to the east and provoke the war between the former Soviet Union and Germany in an attempt to get rid of the predicament in the struggle between the former Soviet Union and Germany and other fascist countries.

Finally, World War II broke out. Of course, the final result is that the United States got out of trouble through World War II, while Britain and France did not play well.

If we compare the whole process of the economic crisis in 1930s, we will find that the present situation is very similar to that period, but the roles involved have changed a little, but the script is still the same. The financial crisis that originated in the United States is developing towards the real economy. Now the real estate industry and the automobile industry in the United States are in crisis, leaving only the steel industry. I am afraid that the United States will be familiar with the "Obama New Deal" again.

Due to various historical and cultural factors, these old imperialist countries in Europe are afraid to implement the strategy of "bringing disaster to the East" again, but their goals have changed. The targets of this action are likely to be China and India.

Because the global economic crisis is too large, the wealth accumulated by ordinary small countries is not enough to fill the huge hole in the western world economy. Only the wealth accumulated by China is enough. Therefore, plundering China's wealth to get rid of the predicament should be the established goal of western countries.

How was China's wealth plundered? I don't think China will deliver it himself, so the easiest way for western countries is to go to war. They just robbed it.

But China is too big to make a useless enemy for China. Like Japan, South Korea and Vietnam, they will never be surprised by the fire in the West. These countries are really playing with China. They can be provocative, but they dare not practice.

So, India was chosen. India has the dream of being a big country, a large population, a fairly high population density and territorial ambitions for China, so I am afraid it also has the impulse to compete for living space. Therefore, India is an ideal chess piece of the West, and it is qualified to be an enemy of China. Recently, The Times of India publicly clamored that India must strengthen its military preparations and enhance the attack capability of the Indian army and air force. According to the present situation, India is fully capable of defeating the joint "aggression" of China and Pakistan at the same time.

The west is not idle. The United States has established ten important military bases around China, which has completely surrounded China. It is conceivable that these military bases will play a role once the Sino-Indian war is defeated.

In short, the firewood has been piled up, depending on who lit the fire.

So, if we ask, will the world repeat the whole process of the economic crisis in the 1930s? The answer is that it is very likely that the Chinese nation has really reached the most dangerous time again. /viewthread.php？ tid=2634

1929- 1933 economic crisis

1914-1918 World War I was a catastrophe in human history. Europe is the main battlefield of this war. Britain, Germany, France, Russia and other imperialist countries are fighting to the death for hegemony, and their vitality is greatly weakened. Only the United States has strengthened its economic and military strength in the war. Even Britain, the largest investor at that time, owed the United States $4 1 billion. The United States has changed from a pre-war debtor country to a major creditor country and an international financial center in the capitalist world. At the same time, the United States has also jumped from a pre-war industrial power to the number one economic power in the capitalist world.

1920- 192 1 After the economic crisis, capitalist countries entered a relatively stable development period, in which the economic development speed of the United States was the most remarkable. Although the economic prosperity of the United States was interrupted by local intermediate crises in 1924 and 1927, by 1929, the total industrial output value of the United States had increased by 53% compared with 1920, the labor productivity of workers increased by 3.8% on average every year, and the real wages of workers also increased. During this period, the economic policies implemented by the Party and the government were very beneficial to monopoly capitalists, the tax burden of industrial and commercial enterprises was very light, and the development of monopoly organizations was unrestricted. In fact, the anti-monopoly law has not been implemented. These policies have stimulated the development of technological inventions and emerging industries. The 1920s was a period of great development of American automobile industry. 19 19 American automobile production reached1500,000, and 1929 soared to nearly 5.4 million, with an average of one car for every six people. Automobile manufacturing has become the largest industrial sector in the United States, and its development has also promoted steel, rubber, oil and glass. Other sectors such as electrical industry, construction industry, chemical industry and public utilities have also developed rapidly. The total product value of household appliances was only 1 92106,000 USD in 1929, and it has increased to 4160,000 USD. During the war, civil construction almost stopped, housing was very tight and the rent was high; After the war, the annual construction cost exceeded 7 billion dollars, and the construction cost of 1926 was as high as 1 10 billion dollars. From 19 19 to 1929, the gasoline output also surged from 86 million barrels to 439 million barrels. With the rapid development of American industry, its proportion in the total industrial output value of the capitalist world has increased from 38% in 19 13 to 48.5% in 1929, and the national income has also increased from $59.4 billion in 192 1 year to/kloc. From 65438 to 0929, the United States had a gold reserve of $5 billion, accounting for more than half of the world's total of $9 billion at that time.

The surge in production stimulated its credit expansion. From 1923- 1929, the amount of securities issued in the United States reached $49 billion. Only during 1928 and 1929, the amount of securities issued was18 billion. Crazy and unprecedented investment in the stock exchange has kept the stock price rising. The average price of securities in new york Stock Exchange was only $98 at the beginning of 1923, rose to $306 at the beginning of 1929, and reached its peak in September of 1929, rising to $365.

Market performance of Dow Jones 30 industrial stock indexes 1900- 1934.

At that time, only 10% deposit was needed to buy securities, people who participated in securities speculation bought a lot of securities by borrowing, and two-thirds of securities transactions were conducted through bank loans. Speculation in the securities market, like a trend, has become a hot topic and discussion material in newspapers. Speculation in securities contributed to the illusion of prosperity.

In terms of speculation, there are also fanatical real estate speculation that can be equated with the securities market. Stimulated by this activity, housing construction is increasing, which also stimulates industrial sectors related to capital construction, such as steel, timber and mining.

In this frenzied era, public opinion trumpeted "eternal prosperity" and "American exceptionalism", as if the United States had surpassed the operating law of the capitalist economic cycle, and there would never be an economic crisis characterized by overproduction again. Even President Hoover of the United States, in his inaugural address 1929 in April, sang about poverty eradication.

The "rationalization" movement of industry and the expansion of emerging industries such as automobiles and luxury goods have also strengthened the trend of capital accumulation and concentration throughout the "prosperity" period, and small and medium-sized enterprises, independent small producers and small businessmen have generally been eliminated and merged. 1927, two thousandths of companies in the United States account for nearly 70% of the total revenue of companies in the country, and the remaining 99.8% companies only get a part of the remaining profits.

It can be seen that the United States and even the whole capitalist world are like balloons blown too big, which are in danger of exploding at any time. 1929 10 An unprecedented crisis finally broke out in the capitalist world.

The crisis first broke out in the United States, the most developed capitalist country. American industrial production reached its peak in June 1929, and the industrial production index began to decline rapidly during June 10, and the market gradually declined. 10 year 10 On October 20th, new york Stock Exchange went bankrupt, especially on 23rd, 28th and 29th, the stock market plunged. In a few days of panic, the market of primary securities actually fell by 40-60%. Many securities holders went bankrupt immediately, and capitalist suicides described by Mao Dun in his novel Midnight occurred frequently in the United States.

The wave of stock exchange bankruptcy has spread to all capitalist countries, and the exchanges in Britain, Germany, France and other countries have also gone bankrupt. 1929 The bankruptcy of the autumn exchange is a signal that its overproduction crisis is deepening. Since then, production in capitalist countries has continued to decline, commerce has continued to shrink and unemployment has continued to increase. It was not until 1933 that the capitalist world began to turn from crisis to depression.

The crisis of 1929- 1933 is the deepest crisis in the history of capitalism. The decline of industrial production is unprecedented in all previous crises, and the actual trade volume of international trade has also declined for the first time in history. Not only has the output dropped dramatically, but it has also lasted for a very long time. In the previous crisis, the decline in output lasted only a few months, but this time it was dozens of months. In the United States, for example, it takes more than 40 months for coal, pig iron and steel to recover from the lowest point during the crisis to the pre-crisis level. Therefore, the crisis of 1929- 1933 has become the longest-lasting world economic crisis in the history of capitalism.

1929- 1933 The combination of extreme profundity and unprecedented persistence of the crisis has made this crisis extremely destructive, greatly retrogressed capitalist industry and commerce, and wiped out the achievements of decades of productivity development. The crisis before World War I usually set the production level back for one or two years, and it is rare to set it back for four years or more. However, the crisis of 1929- 1933 made the industrial production level of the whole capitalist world fall back to around 1908- 1909. Among them, the United States retreated to 1905- 1906, Germany retreated to 1896, and Britain retreated to 1897.

The crisis is not limited to production and commerce, but also extends to the bank credit system, foreign exchange and debt. The decline in commodity prices in the overproduction crisis made it difficult for industrial capitalists, craftsmen, farmers and other debtors to support them, which led to the bankruptcy of many companies and business owners. Tens of thousands of joint-stock companies in the United States, Germany and France closed down. Not only the capitalists went bankrupt, but in fact some bourgeois countries also went bankrupt.

1931September, Britain was forced to abandon the gold standard and announced the devaluation of the pound, which shocked all countries in the world. The gold standard linked to the pound in the Commonwealth and many European countries also collapsed. 1933 in March, the wave of the collapse of the credit and monetary systems in the capitalist world hit the United States. The wind of bank failures in the United States is even more fierce. By 1933, 1 1730, Bank of America and 252,000 enterprises have closed down. 1On March 4th, 933, American President Roosevelt had to announce the bank's "vacation" on his inauguration day, and then closed new york Financial Center and abandoned the gold standard.

1929- 1933, the unprecedented profound and serious capitalist world economic crisis declared the failure of capitalist economic theory advocating laissez-faire. The crisis shows that it is not easy for capitalism to climb out of the crisis on its own. Thus, Keynesianism advocated strengthening "state intervention" to stimulate the economy and maintain "full employment" came into being. Keynesianism tried to overcome the crisis, eliminate unemployment and prevent revolution by strengthening the artificial measures of "state intervention" in the economy. /f？ kz= 1 17809478