Lesson Reflection 8 What is the Great Depression? What caused it and how did it affect the Americans and the world? The Great Depression began with the stock market crash of 1929 and was made worse by the 1930s Dust Bowl. It was caused by the government which allowed people to use credit from the bank to buy goods. Thus, when people were not able to repay their debts, to the bank resulting the bank to enter bankruptcy. When this started, share markets plummeted and investor became bankrupt and most of the people there became poor. How does knowing more about the period in history helps you to understand the characters and setting from Chapter 1 to 7? It helps me have a clearer image of how the people back then lived. It tells me that most of the people were poor and lost all their money.