October 29, 1929 is known in the history as the black day of the American stock exchange. The remarkable economic growth had favoured shares demand to such an extent that their price quickly attained levels that engendered the mistrust of stockholders and buyers. This mistrust was expressed through mass sales and within a few days it turned into panic. The precipitous decline in stock values was catastrophic for small savers and enterprises were deprived of funds that were necessary for their further growth. By the end of 1930 the number of American unemployed people had risen to more than 6 million. The impact of the American stock exchange crisis on Europe was immediate. American capital that had been invested in Europe was revoked and U.S.A. markets closed for European products. The waned trade activity worsened, when different nations imposed tariffs in order to protect their domestic production from foreign antagonism. The dependence of Germany on the financing by the U.S.A. made the defeated nation particularly vulnerable to the crisis. In 1932, about half of the country's workforce had ended up unemployed.
What brought America out of the deadlock was the government of Franklin Roosevelt, who was elected to the presidency in 1933. Adopting the strategy proposed by the British economist, John Maynard Keynes, the president of the U.S.A. summoned up the potentialities of the state machine in order to boost the immobilised economy. Massive public works created thousands of posts, so that money would circulate once again in the market and that the cycle of goods demand and supply would be stimulated. The unprecedented state intervention in the private sector in the metropolis of free market economy functioned as an example for Europe as well, where the role of state had never ceased to be significant, anyway. The policy of state planning and welfare became the rule for the European interwar period.