Quantum point contacts are narrow, one-dimensional constrictions usually patterned in a two-dimensional electron system, for example by applying voltages to local gates. The linear conductance of a point contact, when measured as function of its channel width, is quantized(1-3) in units of G(Q) = 2e(2)/h, where e is the electron charge and h is Planck's constant. However, the conductance also has an unexpected shoulder at similar to 0.7 G(Q), known as the '0.7-anomaly'(4-12), whose origin is still subject to debate(11-21). Proposed theoretical explanations have invoked spontaneous spin polarization(4,17), ferromagnetic spin coupling(19), the formation of a quasi-bound state leading to the Kondo effect(13,14), Wigner crystallization(16,20) and various treatments of inelastic scattering(18,21). However, explicit calculations that fully reproduce the various experimental observations in the regime of the 0.7-anomaly, including the zero-bias peak that typically accompanies it(6,9-11), are still lacking. Here we offer a detailed microscopic explanation for both the 0.7-anomaly and the zero-bias peak: their common origin is a smeared van Hove singularity in the local density of states at the bottom of the lowest one-dimensional subband of the point contact, which causes an anomalous enhancement in the Hartree potential barrier, the magnetic spin susceptibility and the inelastic scattering rate. We find good qualitative agreement between theoretical calculations and experimental results on the dependence of the conductance on gate voltage, magnetic field, temperature, source-drain voltage (including the zero-bias peak) and interaction strength. We also clarify how the low-energy scale governing the 0.7-anomaly depends on gate voltage and interactions. For low energies, we predict and observe Fermi-liquid behaviour similar to that associated with the Kondo effect in quantum dots(22). At high energies, however, the similarities between the 0.7-anomaly and the Kondo effect end.