The Great Depression(1929-1939)

I) The Market Crashes• Oct. 24, 1929 the NYSE had the

greatest one day loss in history.

• A) The unregulated market allowed people & banks to buy on “margin”

• B) Increasing gap between rich and poor

• C) High US tariffs discourage international trade

• D) Massive overproduction caused a collapse in prices.

II) Crash leads to Depression

• A) Most banks had invested in the stock market with low reserve requirements

• B) Collapse of US economy leads to collapse in world economy

III) The Damage is done• A) Unemployment &

Poverty skyrocket• B) Deflation drops

wages and increases debt.

• C) No capital to invest• D) No demand to

sustain businesses (The Downward Spiral)

IV) Economics affects Politics• A) Huey Long begins

“share the wealth” program

• B) Charles Coughlin criticizes Roosevelt for not going far enough.

• C) Communist Party membership increases

• D) Democracies crumble all over Europe (Germany, Italy, Spain, Portugal)

V) Relief, Reform & Recovery• A) FDIC insures all bank

accounts• B) SEC & FTC regulate

stock market• C) Social Security helps

seniors• D) NLRB created to

negotiate between labor and business

• E) WWII creates demand for munitions. Pulls us out of Great Depression