What is a What is a “Depression”?“Depression”?

Bell RingerBell Ringer

Today’s ObjectiveToday’s Objective

We will We will identify the events that led identify the events that led to beginning of the Great to beginning of the Great

Depression.Depression.

Causes of Causes of the Great the Great DepressioDepressio

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By Brad Harris, Grand Prairie HS

SE: 2B2B, , 2D2D, , 16A16A, , 16B16B

The Great The Great DepressionDepression

The Great Depression was the The Great Depression was the severe economic depression that severe economic depression that

impacted the United States impacted the United States throughout the 1930s.throughout the 1930s.

The Depression The Depression BeginsBegins

The Great Depression started in The Great Depression started in 1929 and lasted until the 1929 and lasted until the beginning of World War II.beginning of World War II.

Personal income, profits, prices, as Personal income, profits, prices, as well as trade dropped dramatically well as trade dropped dramatically

and there was massive nation-and there was massive nation-wide unemploymentwide unemployment

The Depression The Depression BeginsBegins

Causes of the Great

Depression

11.Overproduction of .Overproduction of GoodsGoods

Manufacturers were producing Manufacturers were producing more goods than they could sell, more goods than they could sell,

leading to layoffs in major leading to layoffs in major industriesindustries

1. Overproduction of Goods

Unemployment skyrocketed during Unemployment skyrocketed during the Great Depression, reaching as the Great Depression, reaching as

high as 28 percent high as 28 percent

Investors in the Stock Market were Investors in the Stock Market were buying stocks “on margin,” buying stocks “on margin,”

speculating that the price of the speculating that the price of the stocks would continue to go up.stocks would continue to go up.

2. Stock Market 2. Stock Market SpeculationSpeculation

When stock prices began to fall in When stock prices began to fall in late October, 1929, it led to a late October, 1929, it led to a

massive sell off and the crash of massive sell off and the crash of the Stock Marketthe Stock Market

2. Stock Market 2. Stock Market SpeculationSpeculation

3. Numerous Bank 3. Numerous Bank FailuresFailures

Bankers made unsound investments in Bankers made unsound investments in the stock market. In the months the stock market. In the months

following the Stock Market Crash, following the Stock Market Crash, thousands of banks failed.thousands of banks failed.

3. Numerous Bank 3. Numerous Bank FailuresFailures

Because so many people were in debt, Because so many people were in debt, when they lost their jobs, they could when they lost their jobs, they could not pay back their loans, leading to not pay back their loans, leading to

more bank failuresmore bank failures

3. Numerous Bank 3. Numerous Bank FailuresFailures

If a bank failed, people who had If a bank failed, people who had money in those banks lost their money in those banks lost their savings, leading to bank runssavings, leading to bank runs

4.Tariffs Slow World Trade

The passage of large tariffs led to The passage of large tariffs led to a slowdown of international trade.a slowdown of international trade.

4.Tariffs Slow World Trade

The purpose of a tariff is to protect The purpose of a tariff is to protect American businesses from foreign American businesses from foreign

competition competition

Hawley-Smoot Tariff Act

The Hawley-Smoot Tariff was the The Hawley-Smoot Tariff was the highest tariff in U.S. history and led to highest tariff in U.S. history and led to

foreign countries refusing to trade foreign countries refusing to trade with the U.S., leading to more lost with the U.S., leading to more lost

jobs.jobs.

Black Tuesday (last 2 minutes)

Hoover ReactsHoover Reacts

Coming Coming Up…Up…

Today’s ObjectiveToday’s Objective

We will We will identify the events that led identify the events that led to beginning of the Great to beginning of the Great

Depression.Depression.

Today’s ProductToday’s Product

I will create a bubble map that will I will create a bubble map that will describe the key events that led to describe the key events that led to

the beginning of the Great the beginning of the Great Depression.Depression.