The Great Depression is one of history's most notable periods of deflation

The world's most famous case of deflation happened after Black Thursday

While the details are not fully agreed upon, many economists point to the Federal Reserve's tightening of the money supply as a prime culprit, leading to a significant deflationary spiral.

The US unemployment rate soared to over 24% during the Great Depression

The Great Depression was a devastating and prolonged economic recession that followed the crash of the US stock market in 1929.

The Great Depression was an international depression felt far beyond the US

Many countries suffered through a depression in the 1930s that the First World War, the US stock market crash, and an economic downturn in Germany turned into an international crisis.

The story of the Wall Street Crash of 1929

The 1920s in the US "roared" with rapid economic growth after the conclusion of World War I. But in October 1929, the bubbly stock markets crashed dramatically, plunging the nation into the decadelong Great Depression.

'Good deflation' happens when prices naturally track with supply, meaning prices change gradually

This tends to make products and services more affordable and normalizes the standard of living. Bad deflation usually happens when there are sudden changes to either supply or demand. Near-zero [interest rates helped create the real estate bubble that sparked the Great Recession when it crashed](https://www.youtube.com/watch?v=LMo9mD8j7IA&t=91s) Because deflation distorts the value of money, deflation is particularly harmful for borrowers. Low interest rates made it easy for businesses and everyday people to take on enormous debt, which exacerbated the effects of the recession.

Markets have always recovered and hit new highs following crashes

The crash that preceded the Great Depression was the most severe the US has ever experienced. It was 28 times worse than the downturn that followed the Cuban Missile Crisis.

Economists define deflation as a sustained decline in prices across an economy

Deflationary periods are characterized by broad, significant price declines. The Federal Reserve can monitor deflation by tracking prices through price indexes, such as the Consumer Price Index (CPI), which characterizes the average costs for consumers each month.

Between 2007 and 2009, the housing market saw its most significant downturn since the Great Depression: the Great Recession

The early 2000s were a prosperous period for the housing market, until some lending practices eventually destabilized it, leading to banks collapsing and people losing their homes.

US inflation can generally be split into to two periods—before and after the Federal Reserve

A central bank itself does not mean significant inflation will occur, but economists generally point to factors like two world wars and the printing of money to finance the US federal deficit as primary drivers of price increases.

The Federal Reserve fought the Great Recession primarily with quantitative easing and repurchasing agreements

During the Great Recession, the Fed stimulated the economy by buying people and businesses' debt, notably through purchasing mortgage-backed securities and buying bonds with slim margins. The two processes, quantitative easing and repurchase agreements, both helped increase the amount of money in the economy to increase consumer spending.

Communism grew in appeal during the Great Depression

With at least a quarter of the country out of work, some Americans disenchanted with capitalism began looking at alternatives. Watch this five-minute video to learn about communism's growing allure during the Great Depression.

Japan's 1990s deflation followed the country's fastest growth period

The end of World War II ended Japan's isolation in the global economy, prompting what's now called the "Japanese Economic Miracle." From the 1940s to the 1980s, Japanese policy makers enacted ultra-loose monetary policies that pushed a ton of cash into the market and fueled rapid growth. But these policies ultimately helped create a bubble and sent the country into a deep period of deflation.

Stand-up became more popular during the Great Depression

The stock market crash of 1929 caused vaudeville theaters to shutter. Audiences were looking for lighthearted distractions from the country’s financial problems, though, and stand-up became more popular, albeit in very different venues.

COVID-19's shock to employment rates sparked some economists to fear deflation

COVID-19 simultaneously disrupted the supply chain and the labor market. Since the unemployment rate had hit record highs, some economists were worried that the supply chain would recover before the labor market. If that had happened, businesses would have been producing goods, but no one would have been able to buy them because they wouldn't have the disposable income to do so.

What was it like to live through the Great Depression?

Hear the personal accounts of four people who lived through the Great Depression, as told by NPR's Throughline. Listen to this 47-minute podcast episode to get a bit more insight into the countrywide economic crisis and what it meant it for everyday people.

Central banking in the US has had a fraught political history

That history includes its doomed early efforts in the First and Second National Banks, as well as its failure to address the worst financial period in US history, the Great Depression.

The failures of the interwar period made the case for a new international system

After World War I, countries devalued their currencies, raised tariffs to block imports, and seized territory unchecked, with the international community unable to organize effectively to stop them. The result was a global depression and, eventually, another world war.

In the 1970s, the US experienced a period of stagflation

It was characterized by high inflation, slow economic growth, and high unemployment. The crisis was triggered by a combination of factors, including loose monetary policy that spurred excess demand and spiraling oil prices caused by an OPEC embargo in 1973.

One signal that a recession has become a depression? When GDP declines more than 10%

There’s no single definition for recessions or depressions, but both are marked by sustained periods of declining economic activity. Depressions are more severe than recessions.

Switzerland's currency is so strong that it could cause deflation

Economic instability in the United States in 2025 strongly benefited Switzerland, where the value of the franc relative to the dollar increased by about 12.7%. In response, the price of imports dramatically decreased, making goods overall much cheaper.

The Smoot-Hawley Tariff Act is among the most famous pieces of economic legislation in the US

In a desperate move to save the economy from the deepening global depression, the US placed tariffs on thousands of goods from abroad. This approach backfired, as many of America’s trade partners took retaliatory measures.

How the Great Depression still shapes the way Americans eat

From fortified foods to nutrition labels, the legacy of an early financial crisis lives on in kitchens across the United States. Ethnic foods with their (supposedly) hunger-triggering spices were vilified and considered “stimulants” along the lines of caffeine and so, in their stead came prune puddings, canned-meat stews, and dairy-heavy vegetable casseroles featuring America’s first fortified foods. Read more here.

The Social Security System was created to protect Americans from economic disasters like the Great Depression

President Franklin Delano Roosevelt’s New Deal created new government agencies and programs in the wake of the Great Depression.

Consumer spending accounts for 70% of US GDP, making Black Friday significant

Lizabeth Cohen, a history professor at Harvard and author of the book “A Consumer's Republic: The Politics Of Mass Consumption In Postwar America,” has argued that the US government has presented consumerism as a way out of economic crisis or decline since around World War II.

The US dollar is the most widely circulated currency in the world, and is involved in nearly 90% of global transactions

John Maynard Keynes was one of the most influential economists of the 20th century

Keynes influenced economic thought by arguing that governments should spend to stabilize economies during downturns. His ideas shaped the postwar international order and remain central to modern economic policy debates.

Roughly 43 million US borrowers owe roughly $1.7T in student debt, the second-largest source of consumer debt behind mortgages.

The idea for the Federal Reserve was conceived in secret in 1910—with bankers donning duck hunt gear for disguise while traveling to a remote country club on Georgia's Jekyll Island

While the first exchange-traded fund (a 'basket' of different assets that can be bought and sold on a stock exchange) in the US only launched in 1993, the global ETF market has grown to more than $10T in the short time since.

The United States has had a tumultuous relationship with Cuba since its 1959 revolution, highlighted by a nuclear crisis and a decades-long trade embargo.

Volcanic activity may have triggered the Black Death by spewing gases that led to crop failures in Europe, thus forcing the import of grain ships with plague-infested fleas.

Warren Buffett's former professor Benjamin Graham is known as the 'father of value investing,' a strategy in which investors seek to buy stocks trading below their intrinsic worth.

View the ten deadliest tornadoes in US history.

A researcher recently discovered an interview from 1967 between groundbreaking journalist Joan Didion and the Grateful Dead, years before the band became an institution.

Mark Twain spent decades feuding with the US Postal Service, convinced its costs and regulations were bureaucratic overreach.

Jimmy Carter signed a 1978 bill that legalized home brewing, a move credited with kick-starting the craft beer industry.

Walt Disney's early film 'Alice's Wonderland' was a groundbreaking innovation in the silent film era

In 1939, baseball star Lou Gehrig delivered his inspirational 'Luckiest Man' speech after retiring due to the health condition that now bears his name.

When a Paris department store hesitated to sell Estée Lauder's perfume, she 'accidentally' broke a bottle, causing the smell to spread throughout the store and shoppers to start asking to buy the scent.

The Beatles' US label rejected the band's first two singles, 'Please Please Me' and 'From Me to You,' with one executive calling the band 'dead in the water.'

Alzheimer's can lead to brain shrinkage, with an average of around 2% of volume reduction per year

Explore a list of the 100 best novels of all time, compiled by some of the world's best living writers, including Salman Rushdie, Stephen King, and Jennifer Egan.

In 2026, Finland was named the world's happiest country for the ninth consecutive year based on its wealth, social safety network, and high life expectancy, among other factors.

Most of the observable universe's volume consists of voids and supervoids—enormous regions of space with little to no galaxies, stars, or light.

Fireworks make a loud booming sound after exploding due to air expanding faster than the speed of sound.

About 12.5% of US adults experience a phobia in their lifetime, a diagnosis that hinges on the intense fear interfering with daily life and persisting for at least six months.

The 1987 Nintendo video game 'Stadium Events' isn't known for being particularly fun, but its scarcity has made it a highly sought-after item that has sold for up to $35K at auction.

Domino's Pizza's 30-minute delivery guarantee was responsible for the chain's 1980s surge, but it was discontinued after the company was found liable for delivery driver accidents.

El Niño, Spanish for 'the boy,' was named after Jesus Christ because the phenomenon resembled the weather changes observed around Christmastime.