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THE ECONOMY IN THE INTER-WAR YEATS - Coggle Diagram
THE ECONOMY IN THE INTER-WAR YEATS
Inter-war
between the First World War and the Second World War (1918–1939)
the economies of European countries and of the United States went through various phases
Post-war crisis
between 1918 and 1923
characterised
high levels of debt
a shortage of products
increase in prices.
United States intended to pay for the costs of wa
One of the most severely affected countries was Germany
pay war reparations.
German government circulated large quantities of bank notes
The enormous quantity of worthless bank notes in circulation meant that the German people needed large amounts of money to buy basic goods
hyperinflation
France decided to occupy the richest and most industrialised area of Germany, the Ruhr.
crisis in Germany worse
In 1923, France realised that it would not receive the reparations it needed
The suffragist movement
women, who had shown that they were capable of doing the same jobs as men, did not accept the re-establishment of their traditional social role
continued to protest against the inequality between men and women
continued to protest against the inequality between men and women
In the USA and Europe, the mobilisation of women was supported by the Socialist Party
established International Women's Day
allowed to vote
Russia, Great Britain, Poland, the Netherlands and Austria in 1918.
Germany and Belgium in 1919.
Czechoslovakia and the USA in 1920.
Recovery in the 1920s
The United States and Japan were the first countries to recover from the crisis
enabled the United States to help European countries come out of the economic crisis.
Dawes Plan
In 1924
the United States in Germany
was a series of economic measures which involved loans and American investment in German industry
also revised and reduced war reparations payments.
France also agreed to abandon the occupied areas of the Ruhr in August 1925.
From 1925 on, Germany's economy began to recover.
the world economy began to recover and grew steadily.
known as the 'roaring twenties'.
life was focused on enjoyment
cabarets, music-halls, ballrooms, radio shows and cinema
Famous Hollywood film stars emerged, such as Greta Garbo, Charlie Chaplin and Rudolph Valentino.
Consumerism grew again and sales of consumer goods such as cars and household appliances increased.
Consumers also bought shares in companies on the stock market because they paid large profits in a short period of time.
The Wall street crash of 1929
In 1929, the Wall Street stock market in New York collapsed.
the beginning of a major economic crisis, leading to the Great Depression of the 1930s.
causes
Industrial overproduction
European industry started to recover and European countries bought less from the United States.
American industry did not reduce levels of production.
the number of products available (supply) was greater than the number of products that were sold (demand).
consumption decreased even further
Agricultural overproduction
had been possible due to the cultivation of more land (to send large quantities of food to Europe) and the mechanisation of agriculture,
European countries began to produce their own agricultural products again, but the level of American agricultural production was maintained
The result was a surplus of production which caused prices to fall.
Speculation on the stock market and excessive bank credit
companies and individuals bought shares in companies on the Wall Street stock market
To buy shares, and to buy houses, machinery or land, both people and companies obtained credit or loans from the banks.
On 24 October 1929, thirteen million shares went up for sale, which caused share value to fall dramatically due to oversupply.
The stock market crisis spread to banks and became a financial crisis.
The banks collapsed (of 23000 banks, 5000 closed) and millions of citizens were ruined.
The great depression of the 1930s
The Great Depression
began with the Wall Street Crash of 1929 and continued for a decade.
This economic crisis led to a fall in prices (deflation) and put an end to the prosperity of the roaring twenties.
consequences
Companies closed due to a fall in sales and a lack of credit.
Wages fell and unemployment increased.
The world economy was affected because the United States reduced imports.
There was a decrease in the standard of living, generating discontent with the liberal capitalist system, which most people blamed for the crisis.
