Question

How had the following areas of American economy shown a weakness before the Depression? Agriculture, foreign trade, and credit

Answer 1

Agriculture showed weakness before the great depression, actually rural parts of America never recovered from the depression that followed WWI. Prices were declining and farmers were behind their mortgages at that time. In the Great Plains problems were even bigger, because farmers faced a severe drought, dust storms, and insects. When the Great Depression came, things got even worse.

Foreign Trade before the Great Depression was a small part of the US economic activity. It was concentrated mostly on farms. The World at the time did not demand American goods as much as before, because of WWI, also, European industry and agriculture were more productive after the War and because of the war, European countries decided not to buy goods from overseas and invest in their own countries.

Credit was another weakness before the Great Depression, as said before, farmers were having many troubles and many of them had their land mortgaged. Crop prices were down and they could not pay what they owed to the banks. This caused a crisis before the Great Depression, the country was full of small banks which made unwise loans and invested poorly in stock markets.

Answer 2

Agriculture--increased production needed during World War I didn't stop after the war. Over production after the war caused crop prices to decrease meaning less money for farmers to pay their debts. Many farmers lost their land during the 1920s before the Great Depression began. 

Foreign trade--much of the world was experiencing a depression after World War I. The US's foreign trade greatly decreased and reduced the markets available for production of food and goods. Also the US began a system of circular loans to help prop up countries in debt, in particular Germany.

Credit--Many Americans were buying goods and stocks on credit. This was based on an early booming economy. However, when over produced items could not be sold, jobs were lost, and people were unable to pay back the credit. This will impact banks, the stock market, and the job market.