The United States and the United Kingdom have a deep relationship and sell more weapons and ammunition to the Allies. This made the Germans quite unhappy. In order to cut off the supplies from the Allied Powers, Germany used the submarine to attack the US merchant ships, forcing the US to declare war on Germany. After the United States joined the war, various industries such as steel, shipbuilding and agricultural products in China made rapid progress. Later, Germany was defeated and the United States received another war compensation. When the Americans looked back, they were just a war, but they made a lot of money.
Since the 19th century, the United States has been the world's number one industrial power. Due to the First World War, all industries have developed rapidly and the economy is booming. In 1920, the United States generated electricity equivalent to Europe's total, and steel production accounted for more than half of the world's. After the war, New York Wall Street replaced London's Lombard Street (London Financial Center) and began to dominate the world economy.
However, after , the United States also faced some problems: factories that used to manufacture weapons were closed one after another. Then the United States poured in with many new immigrants, who snatched away many jobs with cheap wages, and millions of veterans entered the market. Therefore, the number of unemployed people is increasing, resulting in the economic depression in 1921, but this is only temporary. The US economy quickly recovered. , who was elected President of the United States in 1920, came to power and first raised tariffs on agricultural products, making it difficult for foreign agricultural products to be sold to the United States. The income tax rate has been reduced, allowing enterprises to invest more money in the market and provide more employment opportunities. Military factories have transformed, and millions of troops have returned to their posts, and the economy has gradually improved.
In addition, the 1920s were also the era when entrepreneurs promoted the technological revolution . Ford developed an assembly line production. It originally took 700 hours to build a car. It only took 12.5 hours to complete the assembly line, which greatly reduced the cost of the car. Ordinary people only need three to four months’ salary to buy a brand new Ford car .
Before World War I, cars were just toys for rich people and were luxury goods. In 1927, Ford alone sold 1,500 cars, and cars became part of the economy. The economy of automobile-related industries such as steel and oil has also been driven.
Because of the popularity of automobiles, the government has also invested heavily in public infrastructure. For example, the famous 66 was paved in 1926. As more cars emerge, more and more supporting gas stations, restaurants and motels have been provided, expanding domestic economic demand. Household appliances are also produced in large quantities under the power of assembly lines, and banks have also developed ways to pay installments, such as a 200 US TV set in 24 periods, making buying bulk commodities as simple as buying groceries. Major companies made a lot of money, and the stock market also soared.
Since 1924, the US stock market has only risen but not fallen. Many companies have long exceeded the actual growth of . Many Americans get rich because of stock trading . People have a speculative mentality and hope to return the money earned in the stock market to the bank's installments, and then buy. These funds that blindly flow into the stock market also further pushed up the price of , and the crisis quietly arrived.
Things will turn out to the extreme, and slowly the society is filled with a strange atmosphere. First, installment payments are paid, and banks are lent more and more money. What should I do if I can’t afford it? Second, the overcapacity of enterprises is full of inventory, and another thunder is buried here; Third, the number of unemployed people in cities is gradually increasing. In rural areas, agricultural product prices began to plummet due to oversupply. The most terrifying stock cannot just rise but not fall. Some smart American stock investors discovered this problem and chose to sell their stocks one day in 1929. The US stock market instantly plummeted by 11%. From that day on, the US stock market plummeted. In less than three years, the US stock market plummeted by 89.2%. The stock market collapsed, and two other thunders began to explode.
And it is the war that really ended the Great Depression of . In 1937-1939, before the outbreak of in World War II, when the European war was about to break out, the arms race stimulated the European economy, and the unemployment rate dropped sharply. After the war broke out in 1939, the unemployed population was arrested to serve in the military, completely ending unemployment. In 1941, the United States joined the war, and millions of American soldiers entered the battlefield, reducing the unemployment rate to below 10%, and spending on large-scale wars doubled the economy. At the end of World War II, millions of troops re-entered the labor market, and as manufacturing power flourished, government spending decreased, marking the end of the Great Depression.