The great depression
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The Great Depression. The Great Depression And World War II 1929-1945. 1928: Peace and Prosperity. Continuation of good times Helps Hoover get re-elected Prosperity in business was good for country Debt stimulated economy through the purchase of goods as well as stocks on credit.

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The Great Depression

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The Great Depression

The Great Depression

And

World War II

1929-1945


1928: Peace and Prosperity

  • Continuation of good times

  • Helps Hoover get re-elected

  • Prosperity in business was good for country

  • Debt stimulated economy through the purchase of goods as well as stocks on credit


“Everybody ought to be rich”

  • Confidence in business is high

  • Companies keep workers by offering decent wages, benefits and even providing English lesson to immigrants: welfare capitalism


“Everybody ought to be rich”

  • Stock market soars

  • Working people made decent wages

  • Real wages: money with which they could actually purchase things, grew.

  • Unemployment was low


Signs of Trouble

  • Too many goods

  • Warehouses become stockpiled with surplus goods.

  • Wages didn’t allow people to purchase goods as fast as they were made = credit.

  • Especially harmful to the auto industry and those industries that depended on automobile production such as steel, rubber and glass.


Signs of Trouble

  • Economy is out of balance in the amount of rich vs. poor people.

  • Buying on credit leads to an increase in personal debt.

  • Speculation: taking risky chances in the stock market.

  • Buying stocks on margin: or on credit


Stock market crash

  • Thursday, October 24, 1929: Black Thursday panic selling leads to a huge drop in stock prices.


Stock market crash

  • Hoover says not to worry, economy is sound.

  • Efforts to stabilize the economy fail. By the following Tuesday, October 29, aka Black Tuesday, another 16.4 million shares of stock were sold.


What caused the Great Depression?

  • Over speculation: stocks were bought with borrowed money.

  • Those stocks were then used as collateral to secure more loans to buy more stocks.

  • Investors lose confidence: stock market crashes.

  • Government policies: Interest rates are cut in the 1920’s to stimulate economic growth. In 1929, the government reverses policy and introduces a “tight Money” policy to dry up credit.


National effects

  • Farmers: Post War demand for food is low.

  • Crop prices continue to fall and farms held for generations in families are lost to creditors.


National effects

  • Severe drought affects the Great Plains

  • Turning the area into a dust bowl


The Dust Bowl

  • America’s Breadbasket

    • Long growing season, deep fertile and dry soil.

    • Heavy plows brought in to break the topsoil and get to the fertile soil underneath

    • Excellent atmosphere for wheat.


The Dust Bowl

  • More land is plowed than ever with the modern plow.

  • Drought occurs early 1930’s and lasts for 7 years.

  • Dust storms called “Black Blizzards” hurl dust as far as New England.

  • 60% lose their farms due to the combination of drought and over plowing that blew the fertile soil once enjoyed by the farmers away forever.


National Effects

  • Banks close as nervous depositors rush banks to withdraw their savings.


Americans Live through the Depression

  • Henry Ford closes down his auto factories in Detroit leaving 75,000 people out of work.

  • No unemployment insurance available for Americans.

  • Jobs, savings, all disappeared.

  • Rise of homeless: New York 15,000

  • Shanty towns develop across the country made of tar paper shacks nicknamed: Hoovervilles after the president for whom they held blame for their predicament.


National Effects

  • Families face real challenges as generations forced to live together in tight quarters

  • Suicide rate soars, depression and fear linger in the hearts of Americans.


National Effects

  • African Americans fared the worst during the depression.

  • Continue migration from the South to the North.

  • Most menial jobs they had been able to get were now being taken by whites.

  • Discrimination in the south heightened as no African American was entitled to a job as long as a white man was out of work.


Women and Minorities live through the Depression

  • Women secure domestic positions and the burden to support families often times rests on their shoulders.

  • Married women continued to be discriminated against, though, as they were considered to be taking jobs away from men.


Getting through it together!

  • Twenty-first amendment repeals prohibition.

  • Empire State building is begun in 1930 and seen as a symbol of hope.

  • Federal government funds and action to help relieve the misery in the country are lacking under Hoover.

  • People look to the election of 1932 as hope for their future.


Worldwide Repercussions

  • U.S. was the world’s leading economic system

  • Nations were interdependent: through international banking , manufacturing and trade.

  • France and Britain unable to repay war debt as U.S. investment in Germany wanes and therefore reparations cease to be paid to the Allies.


Worldwide Repercussions

  • Riots occur and lead to political upheaval and shifts in power in a variety of European countries. Red Scare (Fear of communism)

    begins here in the U.S.


What Does Hoover Do?

  • At first nothing

    • Economy is Lassie-Faire

    • Will take care of itself

    • Hoover Dam

    • Work too late

    • Not enough jobs

    • Temporary jobs

    • Hoovervilles, Hoover flags and Hoover Blankets

    • Bonus Army


Election of 1932

  • FDR & the New Deal: promises of real help for Americans.

  • Popularity rises over

    Hoover and

    the Republicans.

  • Hoover’s actions were seen as weak.

    • Didn’t provide work to those who needed it most.


FDR: Continued

  • Compassion towards working class.

  • Felt the Government had a responsibility to its citizenry to take a more active role in economic recovery.

  • Wanted to implement similar programs on a National level as those he had found success with as Governor of New York.


FDR Wins the Election and a New Era Begins.

  • Inaugural Address:

    “…So first let me assert my firm belief that the only thing we have to fear is fear itself.”

    • Promises a future of governmental involvement in people’s lives.

    • People are tired of trying to make it on their own and look for the government for help.


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