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Which action by the federal government was one cause of the Great Depression?

User Vitch
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Final answer:

Federal government actions contributing to the Great Depression included limited regulation of banks, reluctance to use deficit spending, and hesitant interventions following the stock market crash in 1929. These actions, or lack thereof, under President Hoover's administration failed to prevent the catastrophe, and it took FDR's New Deal to implement substantial government intervention.

Step-by-step explanation:

Actions by the Federal Government Contributing to the Great Depression

While the Great Depression was caused by a multitude of factors, actions by the federal government that contributed to the economic crisis included policies of limited intervention initially under President Herbert Hoover. One such action was the failure to effectively regulate banks and financial markets, as well as the reluctance of Hoover's administration to embrace deficit spending, public works projects, and deliberate inflation to help spark the economy.

Furthermore, after the stock market crash of 1929, Hoover attempted various interventions that did not prevent a consumer panic and in certain views may have exacerbated the situation. Additionally, policies preceding the depression, such as those during the 1920s that allowed for a stock market bubble fueled by excessive use of margin, set the stage for the eventual crash and were not sufficiently addressed by Hoover's actions.

It was not until Franklin D. Roosevelt's presidency and the launching of the New Deal that significant government intervention became a key aspect of American economic policy, aiming to protect consumers, improve worker conditions, and stimulate economic growth.

User BigPigVT
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The Great Depression was not a failure of capitalism or of markets, but instead the end-result of misdirected government policies-specifically, the Federal Reserve allowing the money stock to collapse as nationwide panic engulfed the banking system.

Step-by-step explanation:

User Flobadob
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