causes of the depression

As we have discussed on this forum many times banks are allowed to
lend more money than they actually have. In the US, for example, banks
are allowed to lend 9 times the money they have. The amount of money a
bank must have in reserves is called the reserve requirement.

http://www.federalreserve.gov/monetarypolicy/reservereq.htm

Clearly then, banks are not lending federal reserve notes. In banks
are not really lending money at all. They are lending book keeping
entries. These entries are created out of thin air and have nothing to
back them. Ralph hawtery, a former uk treasury secretary put it this
way

"Banks lend by creating credit. They create the means of payment, out
of nothing."

The ability to create money from thin air allows banks to manipulate
the economy. They can make credit cheap and easily available for a
number of years. People take out loans that they can not afford to but
rubbish they don't need. A boom is created.

when the banks decide that people's finances are stretched to the
limit they stop lending. credit becomes difficult to obtain. People
default and are forced to sell their assets for pennies on the dollar.
banks are able to buy these assets. A bust is created.

This mainstream media call this process 'the business cycle'. Bankers
call it ' the periodic fleecing of the flock'.

So, the cause of this depression and just about all other recessions,
depressions and downturns are the banks inflating and restricting
credit.

Rothbard put it this way

"Why do business cycles tend to be recurrent and continuous? Because
when the banks have pretty well recovered, and are in a sounder
condition, they are then in a confident position to proceed to their
natural path of bank credit expansion, and the next boom proceeds on
its way, sowing the seeds for the next inevitable bust."

http://www.mises.org/tradcycl/econdepr.asp