USA in WW1

What was America’s role in the War and did the war ultimately lead to the stock market crash or was it other factors?

America didn’t enter the war until 1917 when Russia dropped out after the Bolshevik Revolution. So the US helped France and Great Britain to hang on u til the Armistice was signed. The Great Depression wasn’t caused by WWI, but it did exacerbate it. America’s fiscal policies and the imbalance between the rich (the top 5% owned 34% of the nation’s wealth) and everyone else made America ripe for a stock market crash. You had a lot of people investing in the stock market who could not afford to do so, and some were even buying on the margin—which basically meant they were borrowing money to invest—made runs on selling stocks and pulling money from banks. It devastated our financial system, and this spread to Europe. Germany was probably hit the hardest, because they were trying to repay ridiculous sums in reparations for WWII, and this made it more difficult, because they couldn’t get financial help from the US anymore.

Fiveable Logo

2550 north lake drive
suite 2
milwaukee, wi 53211



about for students for parents for teachers for schools & districts content team privacy contact


🥇 2020 Fiveable Olympics study plans upcoming events trivia hypertyper resources cram passes


community tiktok discord twitter instagram facebook careers

*ap® and advanced placement® are registered trademarks of the college board, which was not involved in the production of, and does not endorse, this product.

© fiveable 2020 | all rights reserved.