1. Aiperi Ismailova, Johnathan Ives, Miles Kinnamont, Layla Lee
A Historical Comparison on Great Recession and Great Depression: From Economics Point of View
Aiperi Ismailova, Johnathan Ives, Miles Kinnamont, Layla Lee

2. Great Depression & Recession
Historical explanation for both the Great Depression and Great Recession
The Effects these Economic problems had on the US Economy
What the US did to fix these problems

3. Great Depression: Stock Market Crash
October Stock Prices plummeted in the last hour of trading.
While the market was closed investors panicked.
On October 28th “ Black Monday” the Dow Jones had dropped 13%
The next day “ Black Tuesday” investors exchanged
14.6 million shares of stock.
Sharp decline of the market caused demand for
goods to decline.
25 Billion Dollars lost in crash

4. Bank Failures
Between 1929 to 1933, over 9000 banks suspended operations due to financial duress.
Many Speculations to why this happened
Bank Panics due to decrease in Money Supply
Bank Failures due to decline in GDP

5. Decline of Consumer Spending
The Stock Market Crash Caused a collapse in durable and non-durable goods spending
High unemployment rates
Gold Standard Crisis
Us went off the Gold Standard

6. Great Recession: Housing Market Crash
Subprime Mortgages defaulted
Between , 4 million households were foreclosed, which led to more houses to become foreclosed
19.2 Trillion Household wealth was lost
Household net worth fell considerably
Lehman Bros. went bankrupt
Other Institutions: Freddie Mae, Fannie Mac
AIG, Merrill Lynch

7. Declining Consumer Spending
US Consumption declined in 2008
Decline in consumption caused a sharp decline of wealth

8. Comparison of GDP

9. Comparison of Unemployment Rate

10. Comparison of CPI

11. International Real GDP

12. International GDP Cont.

13. Great Depression Solution
The Banking Act of 1933
Federal System of Bank Deposit Insurance
Regulation of the combination of commercial and investment banking and other restrictions on “speculative” bank activities
SEC and the Securities Act of 1933
Trust Indenture Act of 1939
Established FDIC

14. Great Recession Solution
Interest Rates on Loans decreased
Policies were put in place to prevent sub-prime mortgages
Tax Relief Act of 2010
Troubled Asset Relief Program
Purchase Assets and Equity from financial institutions to strengthen the financial sector

15. Conclusion Giant Declines in Economic Activity Big Market Failures
GDP, Unemployment, and CPI were similar, but the Depression was much more devastating
Different Policies such as Banking Act of 1933 and the Tax Relief Act of were formed to fix the problems
So the Business cycle repeats itself starting with the Great Depression and ending with the Great Recession

16. Questions?