What was the primary cause of the Great Depression?

The stock market crash of 1929 is recognized as the primary cause of the Great Depression because it marked the beginning of a severe economic downturn in the United States and had widespread repercussions on the global economy. On October 29, 1929, known as Black Tuesday, the stock market experienced a catastrophic collapse, erasing millions of dollars in wealth and severely undermining public confidence in the financial system.

This event triggered a chain reaction of economic failures, including bank bankruptcies, high unemployment rates, and a significant drop in consumer spending. As the availability of credit dried up, businesses were unable to expand or invest, leading to further layoffs and a deepening of the economic crisis. The crash demonstrated the vulnerabilities in the banking and investment systems at the time, revealing how speculative practices had inflated stock prices detached from the actual economic fundamentals.

While other factors, such as the Dust Bowl and overproduction of goods, contributed to the hardships during the Depression, they were not the immediate triggers of the economic collapse itself. The Dust Bowl, for example, exacerbated the situation for rural areas but emerged after the stock market crash, further complicating an already dire economic landscape. Therefore, the stock market crash of 1929 is correctly identified as the leading cause