Why do you think it took so long to end the Great Depression?

So you can think of the Great Depression as actually a major crash and downturn, followed by an incomplete recovery, relapsing into a second downturn only 4 years after the bottom of the initial collapse. In historical hindsight, we’ve conflated this into a single Great Depression. read more

The Great Depression was the worst economic crisis in U.S. history. From 1931 to 1940 unemployment was always in double digits. In April 1939, almost ten years after the crisis began, more than one in five Americans still could not find work. On the surface, World War II seems to mark the end of the Great Depression. read more

But World War II actually institutionalized the sharp decline in the standard of living caused by the Depression. The Depression was actually ended, and prosperity restored, by the sharp reductions in spending, taxes and regulation at the end of World War II, exactly contrary to the analysis of Keynesian so-called economists. read more

It should have been. The economic fundamentals that drive all expansions were very favorable during the New Deal. Productivity grew very rapidly after 1933, the price level was stable, real interest rates were low, and liquidity was plentiful. read more