The 1920s offered America immense economic prosperity. American buying power greatly increased during this era of economic free-for-all. Americans were now able to spend money on luxury items, such as refrigerators, radios and telephones. The newly empowered American population found themselves enjoying time for leisures such as movies; a luxury never before experienced on for such a large number of Americans. The American public began buying on credit, paying for very expensive merchandise in small incremental payments. This luxury spending threw the American economy upside-down. America's top-heavy economy was reliant on personal investments and luxury spending, both greatly unreliable sources of income, resulting in a greatly unstable economy.
However, late in the 1920s, this 'economic prosperity' turned into an economic inequality, as the expanse between rich and poor widened. Rapidly rising wages were distributed among the working class unequally, allowing for advancement for some, and forcing some to a grinding economic halt.
The gap between the wealthy and the poor was widening economically, as the American rich continued to obtain wealth, while the middle class, and working poor fell lower and lower into the poverty ditch. Furthermore, the number of poor in America was growing, while the number of wealthy made up only a small minority high atop the economic ladder. In the late 1920s, one percent of the American population made greater than six hundred and fifty percent more than the bottom eleven percent of the population.
Unequally distributed, the money in America was greatly concentrated in a very small portion of the population. The working poor so greatly outnumbered the upper class, that it was often difficult to see prosperity in America at all.
Unequal Distribution of Corporate Power
Poorly Structured Banking
Foreign Balance of Payments
American Economic Beliefs
