Final answer:
The Great Depression was exacerbated by the U.S. stock market collapse in 1929, which was a critical factor in the decade-long economic hardship experienced worldwide. Bad economic policies and the reduction in global trade furthered the severity of the crisis. It took the economic demands of World War II to start the journey back to prosperity.
Step-by-step explanation:
The economically damaging effects of the Great Depression were worsened in 1929 primarily by the U.S. stock market collapse. This event signaled the beginning of a decade of economic hardship, which spread throughout the United States and across the world, leading to severe unemployment and poverty. Several factors contributed to the onset of the Great Depression, but the stock market crash was the catalyst that accelerated the economic decline.
After the stock market crash, American banks demanded repayment of loans previously extended to Europe, causing a domino effect of financial crises globally. The Great Depression was characterized by plummeting worldwide gross domestic product (GDP), massive unemployment, and a significant reduction in consumer spending and business investment. Poor governmental policies, such as the Hawley-Smoot Tariff Act and austerity measures, further exacerbated the situation, stifling trade and causing additional economic contraction.
As governments around the world grappled with the crisis, ideologies such as communism gained traction amongst those disillusioned with the failures of capitalist economies to address the widespread suffering. It was not until the advent of World War II that some relief came to the global economy, due in part to the economic stimulation from wartime production demands.