Prelude - The Path to Crisis
The nineteen-twenties was a period marked by leaps in technological development and economic growth. The United States led the world in economic development, and it had become the world's prime creditor as a result of World War I, experiencing growth rates that surpassed those of Europe by threefold. The raise in productivity of the workforce raised the wealth of the American nation remarkably, although the benefits were distributed quite unevenly.
Social security did not exist in the twenties. There weren't any unemployment benefits or government aid. The influence of organized labor diminished, and at times, union membership provided grounds for dismissal. Although productivity was high, the income gap was widening. The twenties introduced a range of new products, and the rising advertising industry marketed them skillfully. Yet these goods were only affordable for a minority of the population.
Weaknesses in the economy could first be observed in the agricultural industry. Overproduction kept farm prices low and led many farmers into existential crises.
When Herbert Hoover won the presidency in 1928, he endorsed the anti-regulatory, leissez-faire policies of his predecessors. These policies were responsible for the formation of powerful cartels and conglomerates.