The Same Causes of the Great Depression and 2008 Financial Crisis and Its Enlightments

This paper analyzed the same reasons for the Great Depression of 1929 and the global financial crisis of 2007-08. The reasons include the serious imbalance in the real economy, excessive consumption based on loans, defects in the international monetary system, the Fed's mistakes in monetary policy, excessive expansion in virtual economy, etc. In order to avoid financial crises, we should change consumption patterns of excessive overdraft, establish a new diversified international monetary system, balance the virtual economy and real economy, and operate macro financial regulation counter-cyclically.