[4] However, the depression had some effects on the local economy, which can partly explain the 6 February 1934 crisis and, even more so, the formation of the Popular Front, led by the socialist SFIO and its leader, Léon Blum, who won the 1936 elections.

Also, unlike the English-speaking world, particularly the United States, the French invested little on the stock exchange and put their confidence into gold, which was a currency of refuge during the crisis of 1929.

The German reparations decided by the Treaty of Versailles in 1919 brought in large amounts of money which served principally to repay war loans to the United States.

In order to pay the idled workers, the government resorted to printing paper money, which helped fuel Germany's already high inflation towards hyperinflation.

Everything seemed to favour the French; production didn't weaken before 1930, particularly in primary materials, and the country was the world's leading producer of iron in 1930.

The "Anglo-Saxon model" encouraged growth of the money stock, but France saw the Depression as a necessary evil that "purged" the excess liquidity in the world economy and pushed indebted companies into failure.

The Banque de France lost 15 percent of its reserves, and the government was replaced by one led by Pierre Laval, who installed a provisionally deflationist policy before he accepted a public deficit.

That particular winter, it snowed and it froze; thousands of young men, forced out of their jobs by the crisis, struggled on to their last penny, to the end of their tether then, in despair, abandoned the fight... On street benches and at métro entrances, groups of exhausted and starving young men would be trying not to die.

In the rue Madame one day I saw a child drop a sweet which someone trod on, then the man behind bent down and picked it up, wiped it and ate it.

That did little to placate a population anxious for change, and a wave of strikes, involving two million workers,[11] caused factories to be occupied.

On the night of 7–8 June 1936, employers and unions signed the Matignon Agreements by which they raised wages by 7 to 15 percent to increase workers' buying power, stimulate the economy and bring an end to the strikes.

Blum brought in measures to control cereal prices, to insist for the Banque de France to place the national interest above that of the shareholders and nationalise the armaments industry.

[12] Under Daladier, economic conditions slightly improved,[citation needed] despite a backdrop of growing, increasingly vocal communist and fascist movements.