A comparison of today's economic crisis to the Great Depression of 1929-1939

Extract

[...] A major preceding factor that contributed to the Great Depression was a sense of false prosperity throughout the nation that led to overdependence on mass production and consumer spending. In reality 60% of the population in 1929 earned less than the $2000 poverty minimum (Schoenherr, 2002). The 2008 U.S. Census Bureau report states that or 37.3 million American citizens, lived in poverty in 2007 (U.S. Census Bureau, 2008). A poverty rate of is very low compared to but a look at the unemployment ratings gives a different perspective. [...]

[...] The circumstances surrounding the beginnings of and the attributed cause of falsely perceived prosperity are mirrored in both of the economic crisis. Unemployment and poverty levels remain much lower than those realized during the Great Depression. However, high credit card and mortgage debt have the potential to reduce the standard of living for those who earn a wage above the poverty line. Bank closures have been held off by government funding, but the economy continues to teeter along a thin line. The comparisons show that the financial crisis of today is not quite on the level [...]

[...] Bank failure during the Great Depression is partially credited to a widespread panic among the public that led to the closing of personal accounts. The current rash of bank closings is credited largely to poor lending decisions by the financial institutions, such as offering high mortgages to financially unprepared homebuyers. Though the reasons behind the bank failures are different, both were due to the economic environment of the time. In addition to similarities in the economic environment, comparisons can be drawn between the political climates of the two time periods. [...]