The Great Depression
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Transcript of The Great Depression
Section 1 – Pg. 442
What you need to know…
1. Explain the warnings that financial experts issued about business practices in the 1920’s
2. Causes of the stock market crash in 1929.
3. How did the banking crisis and business failures point to the beginning of the Great Depression?
4. Main Causes of the Great Depression
#1 – Warnings from experts…
Danger !!• Farm crisis• “Sick” Industries• Reliance on credit – buying
goods without actually paying money
• Buying/Selling stocks quickly inflated stock prices
• Margin Buying
#2 – Stock Market Crash
Once the stock market starts to fall, can anything reverse the decline?
1. Rising Interest rates and other factors worry investors.
2. Investors sell stocks.
3. Stock prices go down.
4. Heavy sales continue.
CRASH
#3 – Banking Crisis Depression
• Borrowers could not pay loans – default• Banks left with little $$
• Depositors panicked and tried to take life savings out.• 1930-1932 5,000 banks failed.
How do Banks Make $$ ??
#3 – Business Failures Depression
• GNP: Gross National Product – total value of goods and services produced in a given year.• 1929 = $103 Billion• 1933 = $56 Billion
• Industry lost money in the stock market• Consumers did not buy
• NO MORE USING CREDIT!• Forced companies to have less inventory, scale back
making products, lay off employees or go bankrupt.
#4-Causes of Great DepressionPg. 5 in Packet
• Global finances after WWI• Others = paying war debts buying American goods• Smoot-Hawley Tariff
• Few people had wealth, many had debts.• No buying power
• The Business Cycle• The normal ups and downs in a free-enterprise
economy
What you need to know…
1. Describe how unemployment affected the lives of workers during G.D.
2. Compare/Contrast hardships between urban and rural citizens.
3. How G.D. affected family life and American attitudes.
4. Explain how popular culture provided an escape from G.D.
#1-Unemployment affected lives
“Everyone in America was looking for work.”1929 – 1.5 Million
unemployed1933 – 15 Million
unemployed• Wages • Hours • Immigration • Discrimination • Women working
#2 –Life in the city
• Unemployment & Poverty• Fighting over scraps• Groups tried to provide to the needy
• Salvation Army, Red Cross, mutualistas, rent parties• Breadlines
• Eviction Shantytowns / “Hoovervilles”
#2 –Life in the country
• Prices - Who could buy?• Too many products• Income - Foreclosing farms• Pressured migrant workers to leave• Dust Bowl – drought in some states
#3 –Family life & attitudes
• Fractured some families / forced some families together• Divorce • Birthrates • Depression was the mood – 28% increase in suicide in
1932 over 1929• Shame for middle-class / wealthy• Made every penny count – made as much as they could
#4 –Culture = Escape
• Took up inexpensive hobbies• Reading, games, movies, radio
• Literature presented heroes and easy lives / others portrayed grim life
VIDEO
What did the Government Do??What did the Government Do??
Hoover’s PoliciesHoover’s Policies
Section 3 – Page 456-463Section 3 – Page 456-463
What you need to know…What you need to know…
1.1. Explain why Pres. Hoover opposed Explain why Pres. Hoover opposed government sponsored relief for the government sponsored relief for the needy.needy.
2.2. Outline Hoover’s attempts to solve Outline Hoover’s attempts to solve economic problems and analyze the economic problems and analyze the successes.successes.
3.3. Explain how veterans and radicals Explain how veterans and radicals responded to Hoover’s policies.responded to Hoover’s policies.
4.4. Why was FDR a popular candidate in the Why was FDR a popular candidate in the 1932 election?1932 election?
#1 – #1 – Opposition to Government ReliefOpposition to Government Relief
REASONS NOT TO HELPREASONS NOT TO HELP• Relief would create large governmentRelief would create large government• Inflate the federal budgetInflate the federal budget• Reduce self-respect of people getting aidReduce self-respect of people getting aidINSTEAD…INSTEAD…• Rugged IndividualismRugged Individualism – success through – success through
individual effort and private enterpriseindividual effort and private enterprise• Encouraged voluntarism – PCUR Encouraged voluntarism – PCUR
Presidential committee collected info and Presidential committee collected info and donations for local relief agenciesdonations for local relief agencies
#2 – #2 – Government & EconomyGovernment & Economy
• Laissez-faire approach to economyLaissez-faire approach to economy• Funded several public-works programsFunded several public-works programs
• Stimulated business & reduced Stimulated business & reduced unemploymentunemployment
#2 – #2 – Government & EconomyGovernment & Economy
• Established Federal Farm BoardEstablished Federal Farm Board• GOAL: Find ways for farmers to help themselvesGOAL: Find ways for farmers to help themselves• OFFERED: loans, financed cooperatives to reduce OFFERED: loans, financed cooperatives to reduce
expenses by allowing them to purchase in bulkexpenses by allowing them to purchase in bulk
• Established Reconstruction Finance CorporationEstablished Reconstruction Finance Corporation• Loaned tax payer money to stabilize banks, insurance Loaned tax payer money to stabilize banks, insurance
companies, railroadscompanies, railroads• Government realized that they could do something to Government realized that they could do something to
help the economyhelp the economy
#3 – #3 – Radicals / Veterans ProtestedRadicals / Veterans Protested
• Condemned capitalism – felt it led to G.D.Condemned capitalism – felt it led to G.D.• Bonus Army – group that wanted early payment Bonus Army – group that wanted early payment
of pension bonuses owed to themof pension bonuses owed to them• Bill was rejected and caused deadly conflict!Bill was rejected and caused deadly conflict!
#4 – #4 – 1932 Election1932 Election
Rep. Herbert Hoover vs. Dem. F. D. RooseveltRep. Herbert Hoover vs. Dem. F. D. Roosevelt
• Hoover’s gloom vs. Roosevelt’s optimismHoover’s gloom vs. Roosevelt’s optimism• Roosevelt pushed for a fairer distribution of wealthRoosevelt pushed for a fairer distribution of wealth• Roosevelt had designed creative relief programs as Roosevelt had designed creative relief programs as
governor of NY.governor of NY.