History Assignment 8 Essay

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In my opinion, the Hawley-Smoot Tariff is not the only reason causes the Great Depression but also there are many other main reasons such as: crashed of the stock market of 1929, Banks failures, reduction in purchasing across the board, etc... The Smoot-Hawley Tariff Act of June 1930 was created by the U.S. government such to protect American companies while American businesses began falling. This Act raised the tax on import goods thereby leading to less trade between America and foreign countries. This is one reason contribute to the emerging of the Great Depression but it is not the only reason since the Great Depression was first started with the crashed of the stock market occurred on Black Tuesday, October 29, 1929. The Stock Market Crash of 1929 deeply affected stockholders. By two months after the original crash in October, stockholder had lost more than $40 billion dollars. Other reason contributed to the emerging of the Great Depression is the failures of the Bank. Throughout the 1930s over 9,000 banks failed. Since many banks had also invested large portions of their clients' savings in the stock market, these banks were forced to close when the stock market crashed. While customer's deposits were not insured by the bank, thus as the banks failed people simply lost their saving. Seeing people lost their money because a few banks closed, people afraid they would lose their own savings, they rushed to withdraw their money. The massive withdrawal of cash caused additional banks to closed. Facing to a unsure of the economic situation, the rest surviving banks just concerned for their own survival by stop creating new loans. These decision leading to less and less expenditures. On the order hand, the reduction in purchasing across the board is also considered as a reason to the Great

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