What factors contributed to the collapse of the US economy at the end of the 1920s?

The Great
Depression (1929€“1939) was the worst economic downturn in the history of the United States.
Although there had been an extremely severe depression in the 1890s, the Great Depression was
much worse and more prolonged. The Great Depression, like the Civil War of the preceding
century, was an existentialist threat to the nation. The stock market crash of 1929 touched off
the Depression, but it was not its only cause.

Another key cause of the Great
Depression was income inequality. Although the nation's businesses were profitable during the
1920s, wages barely increased. Therefore, consumers relied on installment plans to purchase
vacuum cleaners, washing machines, and other products; this created a great deal of consumer
debt. Affluent Americans were engaged in dangerous speculation on Wall Street; more than a third
of the nation's wealth was owned by one percent of the population.

Third,
farmers were in a desperate economic situation even before the collapse of 1929. Prices for
agricultural products were low during the 1920s. The Great Depression exacerbated the plight of
farmers.

Finally, the complete failure of the banking system and a reliance
on the gold standard were important. Relying on the gold standard had a negative impact on the
money supply, and citizens lost their savings when many banks failed.