What conditions of the 1920’s caused the Great Depression?

One cause was that people began spending less and an overproduction of goods occurred.

This led to a drop in the prices of goods, resulting in lower wages and increased unemployment for workers.

Another cause was the uneven distribution of wealth, which created an unbalanced U.S. economy. During the 1920’s, 1% of the population owned 59% of the nation’s wealth.

A further cause was the decline of foreign trade, due to the U. S A further cause was the decline of foreign trade, due to the U.S. placing high protective tariffs on foreign goods.

A final cause was excessive speculation in the stock market, which drove stock prices up.

When stock prices began to fall in 1929, people panicked and sold their stocks, causing the Stock Market Crash.

As a result, people lost their money in stocks invested and banks shut down when loans went unpaid and bank runs occurred.