Describe the major causes of the Great Depression. By what measures did the New Deal combat the crisis? Write in your own words and cite your sources.

-The stock market crash of 1929.

- Banking panics and monetary contraction

- The gold standard (As the United States experienced declining output and deflation, it tended to run a trade surplus with other countries because Americans were buying fewer imported goods, while American exports were relatively cheap. Such imbalances gave rise to significant foreign gold outflows to the United States, which in turn threatened to devalue the currencies of the countries whose gold reserves had been depleted. Accordingly, foreign central banks attempted to counteract the trade imbalance by raising their interest rates, which had the effect of reducing output and prices and increasing unemployment in their countries. )

- Decreased international lending and tariffs.

Explanation:

The term New Deal derives from Franklin Roosevelt’s 1932 speech accepting the Democratic Party’s nomination for president. At the convention Roosevelt declared, “I pledge you, I pledge myself, to a new deal for the American people.” Though Roosevelt did not have concrete policy proposals in mind at the time, the phrase "New Deal" came to encompass his many programs designed to lift the United States out of the Great Depression.

The New Deal created a broad range of federal government programs that sought to offer economic relief to the suffering, regulate private industry, and grow the economy. The New Deal is often summed up by the “Three Rs”:

- relief (for the unemployed)

- recovery (of the economy through federal spending and job creation), and

- reform (of capitalism, by means of regulatory legislation and the creation of new social welfare programs).

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