The Super Summary of World History - Alan Dale Daniel [161]
On the financial front, credit markets were getting tight because the money supply was lessening as the decade wore on, businesses were worried about getting loans, and the supply of investment capital was drying up. This was taking place worldwide, and some of the problems included the debts being carried from WWI. In Germany, super inflation was threatening European economic stability. When the economic future turns bleak people with investment money pull back; thus, investment capital was vanishing. Except for Germany’s inflation, most of the problems were sub-rosa and not a concern for the public—at least, that is what the elite leaders of the world believed.
Britain’s Empire also proceeded to give Britain trouble. Former colonies now wanted independence and nationhood. England responded by giving many colonies more independence, including a parliament and independence in foreign policy, while still maintaining a close relationship to the mother country. Those former colonies included Canada, Australia, New Zealand, and the Union of South Africa. Most notable in not gaining additional independence was India. The new nations often refused to follow Britain’s foreign policy, thus complicating matters for Britain in the 1930s.
Political problems erupted all over Europe because of growing radical leftist and rightist movements in several European nations. Adolf Hitler, a Germany radical rightist who led the Nazi party, languished in prison in 1925 after a failed coup d’état. While there he wrote Mien Kampf (My Battle) detailing his thoughts about the future of Germany.[195] Hitler’s radical ideas would eventually lead his Nazi party to winning elections in Germany, eventually gaining control of the nation itself. In his book he set out his future plans for conquest, however, few read the tome. Unfortunate, because Hitler adhered to this published plan after he assumed the office of Chancellor of Germany. Due to a good world economy during the early to mid-1920s neither the rightist nor the leftist movements made headway in Europe or Asia, but as the economic situation grew dire things changed. Communist movements gained ground with the result that rightist also attracted followers concerned about the Reds taking over. It was during the crisis of the Great Depression that men like Hitler gained power through the support of the common person who wanted a return to stability. The Great Depression brought on worldwide radical political changes, so please understand this unprecedented economic collapse was a globe changing event and a major reason for WWII.
In the 1920s, England and France were having money problems and sought loans from the United States, or loan extensions, to cover war debts and other matters. American bankers extended the loan payments and gave new loans to Europe keeping the nations economies afloat. It seemed to most these loans were good business because the future looked bright and money was being made everywhere. The banks thought that as the world economy continued improving the money would come flowing in. These assumptions of a bright future proved false.
Causes
We will now start an analysis of the Great Depression’s causes; however, they are still widely debated and unresolved. Many economists argue the 1920’s era displayed real growth, while others think it was an era of false prosperity—profitless prosperity—because business profits were weak even though the economy was booming. Raw data from the 1920’s indicate real profits and real growth, as manufacturing output rose over 23 percent, but underneath it all something else