China 1852–70 The
Taiping Rebellion followed by internal warfare, famines and epidemics caused the deaths of over 100 million and greatly damaged the economy.
Weimar Germany in the 1920s Following Germany's defeat in
World War I, political instability resulted in murders and assassinations of hundreds of political figures. (See:
German Revolution of 1918–1919 and
Kapp Putsch) Germany's finances were heavily strained by the war and reparations in accordance with the
Treaty of Versailles, leaving the government unable to raise enough taxation to operate and make
war reparations. The government resorted to printing money to cover the shortfall, which resulted in major hyperinflation; one book on these events, which includes quotes and a few first hand accounts, is
When Money Dies. Economists, however, tend to attribute Hitler's rise to the
Deflation and the
Great Depression beginning in 1929.
Paul Krugman concluded that the 1923 hyperinflation didn't bring Hitler to power, but the
Brüning deflation and depression. Before 1929, the Nazi party had been actually in decline, receiving less than 3% of votes in the German federal election in 1928 (see
election results of the Nazi Party).
The Great Depression of the 1930s , 1936 While arguably not a true economic collapse, the decade of the 1930s witnessed the most severe worldwide economic contraction since the start of the
Industrial Revolution. In the US, the Depression began in the summer of 1929, soon followed by the
stock market crash of October 1929. American stock prices continued to decline in fits and starts until they hit bottom in July 1932. In the first quarter of 1933, the
banking system broke down: asset prices had collapsed, bank lending had largely ceased, a quarter of the American work force was unemployed, and real
GDP per capita in 1933 was 29% below its 1929 value. The ensuing rapid recovery was interrupted by a major recession in 1937–38. The U.S. fully recovered by 1941, the eve of its entry in
World War II, which gave rise to a boom as dramatic as the Depression that preceded it. While there were numerous bank failures during the Great Depression, most banks in developed countries survived, as did most currencies and governments. The most significant monetary change during the depression was the demise of the
gold standard by most nations that were on it. In the U.S., the dollar was redeemable in gold until 1933 when U.S. citizens were forced to turn over their gold (except for 5 ounces) for fiat currency (See:
Executive Order 6102) and were forbidden to own monetary gold for the next four decades. Subsequently, gold was revalued from $20.67 per ounce to $35 per ounce. U.S. dollars remained redeemable in gold by foreigners until 1971. Gold ownership was legalized in the U.S. in 1974, but not with legal tender status. As bad as the Great Depression was, it took place during a period of high productivity growth, which caused real wages to rise. The high unemployment was partly a result of the productivity gains, allowing the number of hours of the standard work week to be cut while restoring economic output to previous levels after a few years. Workers who remained employed saw their real hourly earnings rise because wages remained constant while prices fell; however, overall earnings remained relatively constant because of the reduced work week. Converting the dollar to a fiat currency and devaluing against gold ensured the end of deflation and created inflation, which made the high debt accumulated during the 1920s boom easier to repay, although some of the debt was written off.
The Eastern Bloc in the 1980s and 90s During the 1980s, the
Eastern Bloc, which relied on a highly centralized form of
planned economy, experienced a decade-long period of
stagnation from which it did not recover. The end of the decade saw revolutions and the fall of communist regimes throughout
Central and
Eastern Europe, and eventually in the
Soviet Union (USSR) by 1991. The process was accompanied by a gradual but important easing of restrictions on economic and political behaviour in the late 1980s, including the satellite states, culminating with economic collapse and
shock therapy in the 1990s. Even before Russia's financial crisis of 1998, Russia's GDP was half of what it had been in the early 1990s. The collapse in the USSR was characterized by an increase in the death rate, especially by men over 50, with alcoholism a major cause. There was also an increase in violent crime and murder.
Russian financial crisis of 1998 After more or less stabilizing after the disintegration of the USSR, a severe financial crisis took place in the
Russian Federation in August 1998. It was caused by low oil prices and government expenditure cuts after the end of the
Cold War. Other nations of the former Soviet Union also experienced economic collapse, although a number of crises also involved armed conflicts, like in the break-away region
Chechnya. The default by Russia on its government bonds in 1998 led to the collapse of highly leveraged
hedge fund Long Term Capital Management, which threatened the world financial system. The U.S. Federal Reserve organized a bailout of LTCM which turned it over to a banking consortium.
1998–2002 Argentine great depression The depression, which began after the
Russian and
Brazilian financial crises, In terms of income, over 50 percent of Argentines were poor and 25 percent, indigent; seven out of ten Argentine children were poor at the depth of the crisis in 2002. The president
De la Rúa eventually fled the
Casa Rosada in a helicopter on 21 December 2001.
Zimbabwe economic crisis (2000-present) Zimbabwe has had an economic crisis since the early 2000s with some periods of partial recovery in between. Hyperinflation peaked at an estimated 89.7 sextillion percent year-on-year in November 2008 then stabilising after the local currency was abandoned. In May 2020, annual inflation reached more than 800% following the reintroduction of the local currency, after which the government stopped releasing statistics as they had previously done over a decade earlier. GDP contracted from 2001 to 2008 and from 2018 to present.
Venezuela economic crisis (2013–present) Since 2013,
Venezuela has been suffering an economic crisis. It's the worst in Venezuelan history, caused by the economic policies of the president,
Nicolás Maduro the successor of
Hugo Chávez, the fall in oil prices and internal and external factors. Since 2014, Venezuela's GDP has been in recession, falling more 40%. The economy has collapsed, causing shortages of basics goods, economic downturn and hyperinflation since 2017. Also, there are drastic increases in the crime, corruption, poverty and hunger. Millions of Venezuelans have fled to neighboring countries.
Other economic trends In Latvia, GDP declined more than 20% from 2008 to 2010, one of the worst recessions on record. In Greece, GDP declined more than 26% starting in 2008. == Doom loop ==