During the past 12 months we have suffered with other Nations from economic
depression.
The origins of this depression lie to some extent within our own borders
through a speculative period which diverted capital and energy into
speculation rather than constructive enterprise. Had overspeculation in
securities been the only force operating, we should have seen recovery many
months ago, as these particular dislocations have generally readjusted
themselves.
Other deep-seated causes have been in action, however, chiefly the
world-wide overproduction beyond even the demand of prosperous times for
such important basic commodities as wheat, rubber, coffee, sugar, copper,
silver, zinc, to some extent cotton, and other raw materials. The
cumulative effects of demoralizing price falls of these important
commodities in the process of adjustment of production to world consumption
have produced financial crises in many countries and have diminished the
buying power of these countries for imported goods to a degree which
extended the difficulties farther afield by creating unemployment in all
the industrial nations. The political agitation in Asia; revolutions in
South America and political unrest in some European States; the methods of
sale by Russia of her increasing agricultural exports to European markets;
and our own drought--have all contributed to prolong and deepen the
depression.
In the larger view the major forces of the depression now lie outside of
the United States, and our recuperation has been retarded by the
unwarranted degree of fear and apprehension created by these outside
forces.
The extent of the depression is indicated by the following approximate
percentages of activity during the past three months as compared with the
highly prosperous year of 1928: