American Economics Essay Example | Topics and Well Written Essays - 500 words

American Economics - Essay ExampleIt was easily understandable that the situation had turn far beyond immediate recovery. During this time, the c erstpt of free market prevailed. This idea suggested that the market would effectively balance itself the business could run smoothly without any organization intervention. With this belief the government of President Hoover did not take any action believing the market would attain balance soon by itself and prosperity would return. It was assumed that once public regained confidence, business would begin and economy restored but the business would not resume as there was surplus in the market that was unsold.Later, the government move to minimize state spending and increase taxes which in turn reduced the liquid money from market and worsened the situation. Attempts were made later to make this freeing good by providing loans to banks in order to pump in money in market by offering relief work, providing loans to industries and expandi ng public works. No financial aid in terms federal help was not provided and the government promoted self help groups to promote self reliance. Decline in world trade and imports reduced because of an increase in import tariff. As an effect, exports also reduced considerably further weakening the state economy.With the onset of President Franklin Roosevelts government, the