The Great Depression vs. 2007-2009 Depression The great depression was a severe worldwide economic depression in 1929, during a decade that preceded World War II. The cause of both depressions is the use of nostalgic economic policies that were outdated and that oversimplified reality. There was growth and prosperity in both depressions and this saw many people taking risks which facilitated to the economic downtowns. In terms of decline of the real economy as measured by a real GDP, industrial production or unemployment, the Great Recession was a bit minor occasion, because between 1929 and 1933, the real GDP fell close to around 30% whereas between 2007 and 2009, it fell by less than 5%. Unemployment in the US was 25 % in 1933 but in 2009, it was 10%, and so was to the other advanced countries (McEachern,Another point is that both the Great depression, 1929-1933 and financial crisis2007-2009 were global financial crisis, though the global incidence between 2007 and 2009 was less compared to that of the great depression between 1929 and 1933. In terms of the nature of the trough after the trough of the depressions, both depressions show that they had sluggish recoveries in terms of the real economy which show expansions at a slowing pace than the downtown. The two episodes saw many countries face big banking crisis. The other similarity the Great depression of 1929-1933 has with that of 2007-2009 is that both episodes led to asset booms and busts. In 1920 there was a housing boom and bust , and was followed by the Wall Street Boom and crash in 1929, whereas in the recent crisis, the subprime mortgage related housing boom which burst in 2006 triggered the crisis. Unlike in the 1920s, the tech boom of the early 2000 didn t lead to a financial crisis (Strawser & Ryan,References McEachern, W. A. (2012). Macroeconomics: A contemporary introduction. Mason, OH: South-Western Pub. Strawser, C. J., & Ryan, M. M. (2012). Business statistics of the United States, 2012: Patterns of economic change. Lanham, MD: Bernan Press.